Would a PS3 price cut do it?

[Stromprophet]

HappySqurriel said: Sony is a profitable company but look at their financial statment as of March 31st 2006: http://www.sony.net/SonyInfo/IR/financial/ar/2006/qfhh7c00000aksvu-att/qfhh7c00000aksx9.pdf The problem is that Sony isn't all that profitable and the Gaming Division (Sony's Golden-Egg laying goose) is going to start to bleed money because of poor sales of the PS3 and PSP. Sony is not in a good position this year because it is likely that Electronics (from the exploding batteries) will likely lose money, gaming (from the start up costs of the PS3) will likely lose money and these losses may not be offset by the profits in all other divisions combined. March 31st will be interesting because Sony will either announce they're losing money or just barely making a profit.

Yeah that may be true. But Microsofts gaming division has been losing money for 20 of the last 21 quarters. It just does not affect these massive companies like you think it would. Last year for the year annually I believe Sony made a profit of 1.2 or 1.3 Billion dollars. Even with losing 450 million on the gaming division last quarter on PS3 costs, and also losing 600 million or so having to replace batteries in laptops. They already payed all the money to replace those batteries and the incurred costs of changing manufacturing methods in China to ensure proper production were applied on last years fiscal statements. As far as future sales, sure it may affect them. But there really aren't that many more manufacturers of the laptop batteries to go to other than Sony. So it's likely Dell and HP probably just keep buying from them. As far as other eletronics, batteries don't have much to do with their DVD players, Blu-ray players, TVs, HDTVs, etc. So I don't think those sales go down that much. "Poor sales of PSP" How are they that poor? They are certainly selling more than say 360 consoles sold worldwide. And software sales from 360 should make them profitable this fall, and PSPs software sales despite not having mega sales are greater for its lifetime than 360. The PSP is a profitable device, costs are down on the parts in the PSP and it's only had a 50 dollar price cut, on software and UMD sales they've turned profitable already. So they are not bleeding any money on that, every single sale is just going against continued operations for manufacturing which would not be that expensive at this point. PS2 sales are entirely profitable and have been for years and are still selling a good amount of Software. In fact, PS2 still sells more software in the US than any other system including the red hot DS. That helps offset PS3 costs. Which is one thing Sony does very well, they continue to support their old system 2 or 3 years after the new one comes out. God of War II is coming out on the PS2 and it looks from reviews that it might just be game of the year. (Unless Halo 3 gets given that title, personally I think Bungie is full of it now and no longer knows how to make the game fun). I bet God of War II is the number one title when it comes out for that month. I just don't think they are taking losses that would cause them to stop making the PS3, or hurt the company as a whole. And looking at it all I still think they could drop the price 100 dollars and be fine financially.