Sony's game division will have sales of 4.3 trillion yen ($27.4 billion in Japanese yen), an increase of 17% year-on-year in the company's home currency, and approximately 21 million PlayStation 5 consoles shipped, according to the 2023 fiscal year. The fiscal year was good on paper. , at least. If you look closely, the signs of slowing growth in Sony's games business are clear. For example, he has shipped 20.8 million game consoles, but he has not yet reached his forecast of 21 million. According to the February 2024 financial report, this figure has already been revised significantly downward from the original target of 25 million units set in April 2023, with PlayStation 5 in the latter half of its lifecycle. Something was also mentioned. For next fiscal year, the company expects game-related revenue to decline by 68 billion yen, or $440 million, due to the lack of major exclusive titles and waning interest in the current PlayStation 5.
But Sony could still top the list of most profitable gaming companies next year, as only Tencent has achieved comparable performance. Last year, this Chinese company ranked second with gaming revenue of $25 billion. International and domestic gaming revenue accounted for approximately 29% of Tencent's total revenue.
Despite making the video game industry's most expensive acquisition ever, Microsoft has been unable to match the returns of Sony and Tencent. In its last annual report, the company behind Xbox, one of the most well-known brands in gaming, reported gaming revenue of about $15.5 billion, down $700 million from the previous year. That could change in the tech company's current fiscal year, which begins in July 2023.
If the revenue generated by Activision Blizzard, which Microsoft completed its acquisition in October of this year, from July 2022 to June 2023 is any indication, the company could significantly outperform Chinese rival Tencent. be. This also depends on whether Xbox's plans for its Game Pass subscription service work out. Significant cost savings from the closure of acclaimed studios like Tango Gameworks, whose latest games Hi-Fi Rush and Ghostwire: Tokyo reportedly attracted more than 1 million players each, will help subscriptions. This suggests that the pipeline from purchase to purchase is still not working as expected.
Microsoft isn't the only major gaming industry stakeholder closing studios or cutting employees. According to crowdsourced database Game Industry Layoffs, approximately 20,000 people were laid off in the gaming industry between January 2023 and May 2024. So, while Xbox Game Pass being below expectations is one factor to consider, the overall gaming industry situation continues to be unpredictable, with growth potential overestimated due to the coronavirus pandemic. It's vulnerable.
