They will be fine. They know how to get to their sales goals but they are afraid of losing out on hardware profits. The answer to that is obviously release those first party games and retrofit PSPlus Premium out with more content and feature to add value to consumers.

This might sound counterintuitive but if the can tie Project Q to PSPlus streaming they will boost profits at an apparent risk to standard console sales.

No matter what they do, they should put all of their focus into delivering good content. Don't cheat the customer and you will be rewarded.

They got Spider-Man 2, Death Stranding 2, Hell Divers 2 and Concord on deck in the immediate future. They want to sell as many consoles as possible to attach as many games as possible. The consumer will see the biggest benefit because it's gonna force them to drive down console prices.

Ps4 and especially switch were boosted by covid and money printing this will not last, everything that goes up will eventually go down, and thr economy needs a recession too cool down prices. 

23.8M is the number they will hit.

People were also sure Sony wouldn't meet their yearly goal last year because it was so high that they never done it before on the later quarters, and they achieved. Even with the "weaker" (record Q1 for Playstation) quarter they didn't review the target down for this year.

https://www.gamesindustry.biz/ps5-uk-sales-surge-again-as-sony-admits-performance-had-been-weaker-than-expected

He (Hiroki Totoki) adds: "By regions, currently in Japan, the sales is strong, and the same holds true for Asia. And about North America, the response to the promotion is quite favorable. In United Kingdom, it’s a bit weak, but Europe as a whole has been performing quite well."

Japan (and apparently Asia) got no promotions because the hardware is selling extremely well despite the price hike from last year. It's interesting that Sony views the UK response to the promotion as being "a bit weak" (sales rose 75% then another 59%), this suggest that PS5's July will be a significantly bigger month globally than June (which might be a bit overtracked here on VGChartz).

Sony seems prepared to minimize profits in favor of hitting their 25 million target and expanding their userbase. Let's see how the market is going to react to the new deals/pricedrop, and whether or not the new sales baseline will be notably higher than usual when the initial effect wears off. September may not be getting any notable deals but it will be boosted by the Spider-Man 2 themed PS5. October is getting the Spider-Man 2 game and potentially the revision. November and December won't reflect the new baseline. We're gonna have to wait until Q1 2024, I'm looking forward to see how it'll fare against their ridiculous Q1 2023!

Edit: Hiroki Totoki may be referring to the UK promotions prior to the latest heavy discount. That would make a lot more sense.

I'm not sure how much overtracked we might be. We are on track to have the PS5 surpass 40 million in the second week of July, which is when Sony said it topped the figure. Only thing I could think of is it topped 40 million in the final day of that week rather than the beginning or middle.

Whatever overtracking if any will me almost irrelevant and perhaps just one region being a bit over with another a bit under.

I'm guessing Sony made the mistake of taking their phenomenal winter numbers this year and thinking they could hold those sorts of numbers beyond that. But of course this past winter is when Sony finally ended stock shortages and flooded the market with PS5s so there was two years of pent up demand that scooped up all those systems. That pent up demand was satiated after that quarter so now they are back to 'normal' Playstation numbers (~20m peak years) but Sony thought they were about to have a year like they've never had before because of that one quarter of pent up demand.

Going into this fiscal year PS5 had a one-off amazing quarter while Switch had a weak quarter. Sony's pent up demand was satisfied while Switch then got double boosted from Mario movie and TotK. Now we are looking at a situation in which Sony likely massively overestimated what they can sell this year while Nintendo likely somewhat understimated what they will sell this year. They forecasted 15m and 25m but they'll probably end up around 16m and 20m.

Though Sony is apparently willing to get aggressive, even early in the lifecycle, on stuff like price cuts, which Nintendo hasn't even bothered with after 6+ years. But PS5 is gonna need those price cuts to even hit 20m. Seeing as how they are getting aggressive about pushing systems and not worrying about profit as much I think Sony can sell 20 or 21m this year. I'm guessing PS5 will have big discounts for the holidays.

Temporary pricecuts after over 2 years, and following an entire year of a price hike, isn't "early in the lifecycle". These deals aren't even that aggressive. PS5 just overperformed to the point of making Sony slightly more confident than they should be for this particular quarter, but it's probably nothing they can't remedy. They will still hit or come close to hiting their target.

The revision should cost less to manufacture and ship, which should offset the reduction of profitability sooner or later. Considering the high price tag, PS5 is on another level than PS4 overall. Hardware profitability was never Sony's focus.