Sony FY 2008 Q2 Results – Analysis – SONY BLEEDING – LOOKING BAD

[bumidan]

the big thing is the structural deficit.

lets pretend they produced a blockbuster game that quarter.

So if all our assumptions are relatively "correct", then if they produced a hit like MGS4 (1st party), then:

Sales = 4 million units
Assume profit is greater coz it is 1st party = $5 per unit (instead of $2)

then that is still only $20 million, out of a loss of almost $400 million

Lets even pretend they made HALO 3 in that quarter.
According to MSFT - Halo 3 earned REVENUES of $330 million.

EVEN IF (VERY BIG IF) they made a NET PROFIT OF $50 million on Halo 3, then IT STILL DOESN'T PUT A DENT in that LOSS.

So even if they keep producing a Halo 3 1st party BLOCKBUSTER every quarter, they lose money.
Again, note that last quarter Sony made money.
And HOPEFULLY in the Holiday quarter, they will also make money.

But PS2 is basically dying, PSP is not selling any software (where the high margins) are.
PS3 is selling decent software and hardware

But the division is still BLEEDING money...
so there must be some sort of structual problems, because it is now 2 years in.

that is assuming the PS3 is almost BREAKING EVEN on hardware already....