By using this site, you agree to our Privacy Policy and our Terms of Use. Close

Forums - Sony Discussion - Sony's Value Plunges 10 Billion After Disappointing PS5 Results

Wonder what people think in light of Sony's president saying he wants to move more games to multiplatform release to increase profit margins because PS5 profit margins are apparently extremely low. Seems like sky high development costs and hardware that doesn't drop in price is really doing a number on Sony. Looks like we're headed to a future where PC at least gets all/most XBox and Playstation games maybe even day and date or close and who knows maybe even multiplat beyond that (ahem Switch 2 ports?). 

Here's a CNBC article on it:

https://www.cnbc.com/2024/02/19/sony-gaming-margin-questioned-after-ps5-sales-cut-sparks-stock-plunge.html

Here's a Resetera discussion going on about it:

https://www.resetera.com/threads/cnbc-sony-plunged-10-billion-after-its-ps5-sales-cut-but-a-bigger-issue-is-its-near-decade-low-games-margin.818616/

Looks to me like the industry outside of Nintendo is basically all going to become one multiplatform setup with all the biggest budget games being forced to have to be on all viable platforms. 



Around the Network

Playstation ought to make some games less massive with smaller budgets. Aside from Insomniac and Guerilla all there first party studios on PS5 seem to make one or two games. Which causes Sony to make a lot of third party exclusive hats on which they barely have any profit.

Also making game budgets so expensive that a title needs to move at least 5 million (300 million budget including marketing) to break even isn't really a sustainable business model. Probably didn't help that the Valhalla DLC was free either. Nothing wrong with titles that have 20 hour campaigns.



Please excuse my (probally) poor grammar

Qwark said:

Playstation ought to make some games less massive with smaller budgets. Aside from Insomniac and Guerilla all there first party studios on PS5 seem to make one or two games. Which causes Sony to make a lot of third party exclusive hats on which they barely have any profit. Also making game budgets so expensive that a title needs to move at least 5 million (300 million budget including marketing) to break even isn't really a sustainable business model. Probably didn't help that the Valhalla DLC was free either.

Problem is this setup doesn't seem to work for anyone but Nintendo because they committed to doing that 20+ years ago. Even on the GameCube, they released games like Animal Crossing and Pac-Man VS. Pokemon was really the first blockbuster game that was several generations behind graphically from the norm of the time -- released in 1998 in the West and took as a big hit. 

Sony's kind of stuck in the model they have, don't know if they can just suddenly change course. Looks like PC game releases for them are going to have to become closer to day and date with PS5 and who knows even beyond that, maybe XBox/Switch 2 versions of some of their IP may be warranted in certain situations. 

Their game budgets are insane too -- 315 million for Spider-Man 2 and I believe that's before marketing costs. 



I'm kind of excited, or at least looking on the bright side, don't need to have PC + xbox + Playstation. Just need a PC because it will get most all games. Never a better time to be a PC gamer.



i7-13700k

Vengeance 32 gb

RTX 4090 Ventus 3x E OC

Switch OLED

Soundwave said:
Qwark said:

Playstation ought to make some games less massive with smaller budgets. Aside from Insomniac and Guerilla all there first party studios on PS5 seem to make one or two games. Which causes Sony to make a lot of third party exclusive hats on which they barely have any profit. Also making game budgets so expensive that a title needs to move at least 5 million (300 million budget including marketing) to break even isn't really a sustainable business model. Probably didn't help that the Valhalla DLC was free either.

Problem is this setup doesn't seem to work for anyone but Nintendo because they committed to doing that 20+ years ago. Even on the GameCube, they released games like Animal Crossing and Pac-Man VS. Pokemon was really the first blockbuster game that was several generations behind graphically from the norm of the time -- released in 1998 in the West and took as a big hit. 

Sony's kind of stuck in the model they have, don't know if they can just suddenly change course. Looks like PC game releases for them are going to have to become closer to day and date with PS5 and who knows even beyond that, maybe XBox/Switch 2 versions of some of their IP may be warranted in certain situations. 

Their game budgets are insane too -- 315 million for Spider-Man 2 and I believe that's before marketing costs. 

Make enough small games and add the Playstation name to it and I expect people will still buy it. Days  Gone was by no means a title that really looked like a high budget release and it sold quite well. The Infamous games also had a smaller scope than Ghost and sold decently. Do it's not like a non high budget can't sell well.

Uncharted Lost Legacy and Miles Morales also did well in their own regard. So I think Sony has some room to make smaller spin-offs from successful titles at least. Rather see them doing that than make 60 dollar ports of PS4 games.



Please excuse my (probally) poor grammar

Around the Network

Oh please. Sony won't be putting their games, outside of MLB, on Xbox and Nintendo.

Sudden big changes in stock values for video game companies are usually caused by investors who don't know much about the video game business to begin with. On VGC's frontpage there's an article where an analyst said that some seriously expected PS's profit margin to raise to ~20% from previously 12%; if someone has that level of delusional expectation, then yeah, they sure aren't going to get what they wanted.



Legend11 correctly predicted that GTA IV will outsell Super Smash Bros. Brawl. I was wrong.

If they do start porting games to other consoles it'll probably be some of their lower sellers or gaas titles similar to what Microsoft is doing. So R&C would be my guess for the first game ported.



The world belongs to you-Pan America

RolStoppable said:

Oh please. Sony won't be putting their games, outside of MLB, on Xbox and Nintendo.

Sudden big changes in stock values for video game companies are usually caused by investors who don't know much about the video game business to begin with. On VGC's frontpage there's an article where an analyst said that some seriously expected PS's profit margin to raise to ~20% from previously 12%; if someone has that level of delusional expectation, then yeah, they sure aren't going to get what they wanted.

5 years ago people would have said "no chance in hell" to big ticket Sony games on PC platforms period. 2 years ago people would've said "no chance in hell" to day and date or closer releases. Remember Sony fans gave XBox fans the most grief when XBox games became PC releases day 1. 

Their new president literally said they have to pursue multiplatform moreso and when you listen to him talk he outlines growth and profit margins as his two top priorities above everything else. So it sounds to me like the days of needing a Playstation to play Playstation games are numbered. 

I wouldn't necessarily expect anything soon regarding platforms past the PC, but at this point I wouldn't rule anything out in the long run either, that do have IP that would sell millions on other platforms too. 

The market for the Playstation + XBox is basically the same size as it was 15-20 years ago, it's not growing, but the development costs of these games has skyrocketed exponentially. 

Last edited by Soundwave - on 19 February 2024

SAguy said:

If they do start porting games to other consoles it'll probably be some of their lower sellers or gaas titles similar to what Microsoft is doing. So R&C would be my guess for the first game ported.

I want those Gravity Rush games. They look like a fun time!



SAguy said:

If they do start porting games to other consoles it'll probably be some of their lower sellers or gaas titles similar to what Microsoft is doing. So R&C would be my guess for the first game ported.

Probably yeah. But then again, Spider-Man stands out as a game that would do sell millions of copies on other platforms too. Who knows. I'm sure they would wait a year or two before entertaining the possibility of that, but it sounds like PC ports are going to be moved up from where they are now. 

For Nintendo it would more be just icing on the cake, if they can get most MS releases going forward, that alone is going to be a huge add that covers several genres they're not strong in ... Halo + COD for FPS, Forza for driving sims, Starfield, Indiana Jones, Blade, Elder Scrolls 6, etc. would all just be nice library additions too.