Sony cuts PlayStation 5 production outlook due to component shortage

Sony Group has reduced its PlayStation 5 production outlook for this fiscal year due to component and logistics constraints, Bloomberg News reported.
Sony Group HQ
The company has cut down the number of PS5 units assembled for the fiscal year to about 15 million, from its previous target of 16 million units.

The development comes amid a shortage of semiconductors which is impacting companies including Sony.

In October, the conglomerate – spanning areas such as entertainment, sensors and financial services – said it was on track to sell 14.8 million PS5 consoles this financial year, a target that takes into account the global shortages.

Sony Group, as per its October forecast, was targeting ¥2,900 billion yen revenue from Game & Network Services division that includes its PlayStation 5 business. Sony reported revenue of ¥2,656.3 billion yen and operating income of ¥341.7 billion yen from Game & Network Services division in fiscal 2021.

Gaming firms’ earnings were hit last year by stay-at-home demand during the depths of the COVID-19 pandemic. Since then, sliding PlayStation user numbers have stabilised, Sony’s finance chief Hiroki Totoki said, as the company approaches the year-end shopping season.

Separately, Sony is partnering with Taiwan Semiconductor Manufacturing Co (TSMC) to build a $7 billion chip plant in Japan.