Sony Q1 FY2020 - 1.9M PS4 (112.3M LTD), Playstation's Best Ever Quarter of Profit $1.15B, Biggest Ever Software Quarter with 91M Games Sold

[Xevross]

I would try and make a good thread but ArmGunar on Era does such an incredible job with these that I'll just link to his:

Key highlights, since his key highlights section is way too long:

• Biggest Profit Quarter Ever for Playstation
• 2nd Biggest Fiscal Year Profit Forecast Ever Despite PS5 Launch
• Biggest revenue quarter for any platform holder outside of holiday season, higher than any xbox revenue in history
• Biggest Software sales in any quarter of 91M beating PS4's previous record of 87.2M during holiday quarter of 2018
• 74% software digital ratio, highest ever
• PS+ subs up to a new high of 44.9m

Sony Q1 FY2020 (April-June) Results - PS4: 1.9m (LTD: 112.3m) / Best Quarter ever for PlayStation / Strong FY20 FCT: $23.4B Revenue & $2.24B Profit | ResetEra

*The US Dollar figures have been converted from Japanese Yen with exchange rate provided in Sony fiscal reports
Source 1 / Source 2


Highlights :

• Over $5.63B Revenue and $1.152B Profit between April-June 2020 (Q1 FY20)
  
  • Biggest Revenue ever for PlayStation (and for any platform holder) during Q1
    
    • Top 3 biggest Q1 Revenue ever is :
      
      • Sony Q1 FY20
      • Sony Q1 FY18
      • Sony Q1 FY19
      
      
    • To show how big Revenue are, Q1 FY20 Revenue are higher than any quarter of Xbox (even Oct-Dec quarters)
    
    
  • Biggest Revenue ever for PlayStation (and for any platform holder) during a non-Holiday quarter (non-Q3)
    
    • Top 5 biggest non-Q3 Revenue ever is :
      
      • Sony Q1 FY20 (April-June 2020 - FF7R/TLOU Part II)
      • Sony Q2 FY18 (July-Sept 2018 - Spider-Man)
      • Sony Q4 FY18 (Jan-Mar 2019)
      • Sony Q1 FY18 (April-June 2018 - God of War/Detroit)
      • Sony Q1 FY19 (April-June 2019 - Days Gone)
      
      
    
    
  • 9th biggest Revenue ever for any platform holder during any quarter
    
    • The 8 quarters ahead are all Q3 (Oct-Dec) from Sony (4) and Nintendo (4)
    
    
  • Best Operating Profit ever for PlayStation during Q1
    
    • Best Operating Profit ever for any platform holder during Q1
    
    
  • Best Operating Profit ever for PlayStation during any quarter
    
    • 1st time, profits during a quarter exceed $1 Billion for PlayStation !
    
    
  
  
• Hardware : 1.9m PS4 sold-in during Q1 FY20 (LTD: 112.3m)
  
  • 3rd biggest shipments for any console during its 7th Q1 (only behind PS1 and PS2)
  
  
• Software : 91.0m games sold-in during Q1 FY20
  
  • Highest software sales during Q1 in video game history
    
    • During the past 3 Q1, PS4 set each time a new software sales record for the industry
    • More games have been sold during this Q1 compared to all Q3 (Oct-Dec) during PS4 era !!!
    
    
  • PS4 is the only console to have 3 Q1 with over 40m games sold
  • PS4 Software LTD almost reached 1.300B games sold (not including "download only software titles" before Q1 FY20)
  
  
• Software digital ratio : 74% during Q1 FY20 (April-June 2020)
  
  • Highest digital ratio ever during a quarter
  
  
• PlayStation Store had its biggest Revenue ever during Q1 with more than $3.67B
  
  • Biggest Revenue ever during any quarter
  • including Digital Software & Add-on content
  
  
• PlayStation Software & Services saw their biggest Revenue ever during Q1 with more than $4.89B
  
  • Biggest Revenue ever during any quarter
  • including Physical / Digital Software & Add-on content / Services
  
  
• New Informations given in financial results
  
  • 113M MAU (monthly active users)
  • 18.5M first-party games sold during Q1 FY20 (vs 11.7M in Q1 FY19)
    
    • 1 game out of 5 sold this quarter was a Sony first-party game
    
    
  
  
• FY2020 Forecast :
  
  • $23.4B Revenue & $2.24B Profit... it would be:
    
    • Biggest Revenue for PlayStation (and for any platform holder) in video game history
    • 2nd best Operating Profit ever for PlayStation
    
    
  
  

Sony Corporation - Q1 FY2020 (April 2020 - June 2020) :

 

Sony Revenue : ¥1968.9bn / $18.30B (+2.2% YoY from ¥1925.7bn / $18.30B - Q1 FY2019)
Sony Operating Profit : ¥228.4bn / $2.12B (-1.1% YoY from ¥230.9bn / $2.10B - Q1 FY2019)
Sony Net Profit : ¥233.3bn / $2.17B (+53.4% YoY from ¥152.1bn / $1.38B - Q1 FY2019)

• 3rd best Revenue ever for Sony during Q1
• 2nd best Operating Profit ever for Sony during Q1
• Best Net Profit ever for Sony during Q1

Sony stock reached yesterday its 52-week high at $81.41

• Highest since May 2001 ($85.75)

Spoiler: Q1 FY2020 CONSOLIDATED RESULTS          
Top of Biggest Profit Drivers for the Quarter :

• Game & Network Services : ¥124bn / $1.152B
• Financial Services : ¥47.2bn / $438.7M
• Music : ¥34.9bn / $324.3M
• Imaging & Sensing Solutions : ¥25.4bn / $236.1M
• Pictures : ¥24.7bn / $229.6M
• Electronic Products & Solutions : ¥-9.1bn / $-84.6M

 Some milestones per segment :

• Music : 3rd Best Revenue and 2nd best Operating Profit ever during Q1
• Pictures : Best Operating Profit ever during Q1
• Imaging & Sensing Solutions : 2nd best Revenue ever during Q1
• Financial Services : Best Revenue and 3rd best Operating Profit ever during Q1

Spoiler: FY2019 RESULTS BY SEGMENT          

Gaming Division - Q1 FY2020 Results (April 2020 - June 2020) :

 

 

 
Gaming Revenue : ¥606.1bn / $5.63B (+32.5% YoY from ¥457.5bn / $4.16B - Q1 FY2019)
Gaming Operating Profit : ¥124.0bn / $1.152B (+68% YoY from ¥73.8bn / $0.672B - Q1 FY2019)

• Best Revenue ever for PlayStation (and for any platform holder) during Q1
• Best Operating Profit ever for PlayStation during Q1
• Best Operating Profit ever for PlayStation during any quarter

On a constant currency basis, Revenue increased +35.7% YoY and Op. Profit increased +71.8% YoY

Gaming Operating Margin reached its highest level ever at 20.5% (previous record was 18.0% in Q1 FY98)

 This quarter, the Gaming Division accounts for :
 - 30.8% of Sony total Sales/Revenue (vs 23.8% - Q1 FY2019)
 - 48.4% of Sony total Operating Profit (vs 31.6% - Q1 FY2019)


PS4 sell-in : 1.9m (vs 3.2m - Q1 FY2019)
PS4 LTD : 112.3m

 Software sold : 91m (vs 49.8m - Q1 FY2019) - including download only titles software
Software digital ratio : 74% (vs 53% - Q1 FY2019)
Software sell-in LTD (minimum) : > 1.299 billion games

• Highest software sales during Q1 in video game history
  
  • During the past 3 Q1, PS4 set each time a new software sales record for the industry
  
  
• PS4 is the only console to have 3 Q1 with over 40m games sold (only Wii also reached 40m, once, during Q1 FY08)
• During this quarter, more than 11.57 games have been sold each second in the world (= 1 000 000 games sold each day)
• More than 740 000 digital games have been sold-through each day on average on the PlayStation Store during Q1
  
  • doesn't include "download only software titles"
  
  

PS+ Members : 44.9m (up from 36.2m - Q1 FY2019)

• All-time high number of PS+ subscribers

PS4 is still tracked ahead of PS2 for now

 


 Here is below the PS4 software sales since FY2015, including the quarterly physical/digital split from FY2016 onward
(doesn't include "download only software titles" ; no data before FY15 because it was not provided)

 


 This is the Quarterly Software Sales since FY16, with the Physical/Digital split

 


 You can take a look below at the evolution of PS Plus subscribers and Software digital ratio over years

 


 Here is now the Quarterly Physical Software Sales on PS4 since FY2016 (from April 2016 onward)
 Including : Sony's average gross margin per physical copy sold

For a $60 retail game, publishers have to pay about $7-10 to Sony as a license fee (publisher's gross margin ~ $33)
 For its own first-party games, Sony's gross margin will be as high as ~ $40
 When Sony's average gross margin is higher than $7-10, that's because it's inflated by the performance of its exclusives

• Q1 FY16 (Apr-June 2016) : Ratchet & Clank and Uncharted 4
• Q4 FY16 (Jan-Mar 2017) : Horizon Zero Dawn
• Q1 FY18 (Apr-June 2018) : God of War & Detroit
• Q1 FY19 (Apr-June 2019) : Days Gone
• Q1 FY20 (Apr-June 2020) : The Last of Us Part II

Q2 FY18 (July-Sept 2018) with Spider-Man didn't go higher (despite good performance), probably because of huge sales of annual sport titles (Madden/NBA 2K/FIFA) which lowered Sony's average gross margin  Click to expand... Click to shrink...  

Gaming Division - FY2020 Forecast (April 2020 - March 2021) :

 

Gaming Revenue : ¥2500bn / $23.36B (+26.4% YoY from ¥1977.6bn / $18.19B - FY2019)
Gaming Operating Profit : ¥240bn / $2.24B (+0.7% YoY from ¥238.4bn / $2.19B - FY2019)

 It would be :

• Best Revenue for PlayStation (and for any platform holder) in video game history
• 2nd best Operating Profit ever for PlayStation

This is the PlayStation Yearly Revenue & Operating Profit with FY2020 Forecast
I added Revenue in USD to give you an idea of what Revenue in JPY mean (therefore if Revenue USD don't follow the same growth than Revenue JPY, it's because of exchange rates)

• FY19 was the 2nd biggest year ever for PlayStation with over $18.19B in Revenue and $2.19B in Profit
  
  • 2nd best Revenue for any platform holder in video game history
  
  
• FY20 Forecast (FY20 FCT) is $23.36B Revenue and $2.24B Profit.... it would be :
  
  • Best Revenue for PlayStation (and for any platform holder) in video game history
  • 2nd best Operating Profit ever for PlayStation
  
  

 Here is below the PlayStation's history of Operating Profit/Loss

 Unlike PS1/PS2/PS3/PS4's launch years, PS5's launch year will see a huge profit of $2.24B thanks to :

• the big PlayStation Store Revenues
• recurrent Services Revenues
• highly-profitable first party games, planned this year (including TLOU Part II and Ghost of Tsushima)

Summary of PS4

 

Previous threads :
FY2019, Q3 FY2019, Q2 FY2019, Q1 FY2019
FY2018, Q3 FY2018, Q2 FY2018, Q1 FY2018  

[the-pi-guy]

Ah I was gonna post this

[Xevross]

Ah I was gonna post this

Too late baby!

These results are insane, absolutely insane.

[the-pi-guy]

Too late baby!

These results are insane, absolutely insane.

Thank you. I tried my best.

[Xevross]

Sony made 124b Yen operating profit this quarter and forecasts 240b Yen for the whole fiscal year, so they forecast 116b Yen profit for Q2-Q4.

2018 was their biggest profit ever with 311b Yen for the whole year but they only got 83.5b Yen from Q1. So in 2018 they made 227n Yen profit in Q2-Q4.

In 2019 they made 238.4b Yen profit after 73.8b Yen in Q1, so 164.6b Yen profit in Q2-Q4.

Despite record breaking profit in Q1 this year, they're forecasting a much lower operating profit for the rest of the year compared to the last two years, only just over half the profit of 2018. They're definitely planning on taking a big hit somewhere, I wonder where...

[Dr. Pezus]

That's some insane software numbers and profits are incredible for being ps5 launch year

[DerNebel]

Sony made 124b Yen operating profit this quarter and forecasts 240b Yen for the whole fiscal year, so they forecast 116b Yen profit for Q2-Q4.

2018 was their biggest profit ever with 311b Yen for the whole year but they only got 83.5b Yen from Q1. So in 2018 they made 227n Yen profit in Q2-Q4.

In 2019 they made 238.4b Yen profit after 73.8b Yen in Q1, so 164.6b Yen profit in Q2-Q4.

Despite record breaking profit in Q1 this year, they're forecasting a much lower operating profit for the rest of the year compared to the last two years, only just over half the profit of 2018. They're definitely planning on taking a big hit somewhere, I wonder where...

Well console launches are expensive.

[Xevross]

Well console launches are expensive.

Yep, absolutely confirms they're not going to try and break even with PS5. They're making a loss with each unit sale for sure.

Break even point for PS5 I estimated at $530 and $510 for the digital, with $480/ $460 meaning they're sold at roughly the same loss as PS4 at launch. This might be a slight overestimate but its hard to say for sure.

Lets say they sell 5M regular consoles at $499 and 5M digital at $399, that would be a total of $150M + $550M = $700M loss on PS5 hardware sold for the fiscal year. That seems pretty reasonable given the forecasts, in fact I think its perhaps a bit conservative.

[Xevross]

There was a 2.31 attach ratio for PS4 at launch. Lets assume these aren't even at full $60 price, lets say $40 average which is probably a lowball. I think attach ratio will increase a fair bit this time around but lets say it only increases slightly to 2.41. This is only by December as well, by March for the fiscal year the attach ratio should be much higher.

2.41 attach ratio for digital only console means Sony gets minimum 30% of sales, obviously its 100% if its a PS published game. So lets say average of 40%, then Sony would get 2.41*$40*0.4 per console or $40 back per console. The physical would be a bit less, assume 2/3 of sales are physical and Sony only sees 20% of that revenue then its about $25 per console recouped.

These very conservative estimates reduce net loss of each console to $5 and $70, which is a lot less (total $375M loss from PS5). There's other new income associated too like extra consoles and PS+ subs, so real loss will be much less. With their forecasts, no way they're expecting such a little loss for PS5.

So yeah, $399 digital is happening.

[DerNebel]

Yep, absolutely confirms they're not going to try and break even with PS5. They're making a loss with each unit sale for sure.

Break even point for PS5 I estimated at $530 and $510 for the digital, with $480/ $460 meaning they're sold at roughly the same loss as PS4 at launch.

Lets say they sell 5M regular consoles at $499 and 5M digital at $399, that would be a total of $150M + $550M = $700M loss on PS5 hardware sold for the fiscal year. That seems pretty reasonable given the forecasts, in fact I think its perhaps a bit conservative.

Yeah, maybe dunno. No idea about the break even point for the PS5 hardware but I also continue to believe that they'll go for $499 and $399 for the PS5 and PS5 DE.

[Xevross]

Yeah, maybe dunno. No idea about the break even point for the PS5 hardware but I also continue to believe that they'll go for $499 and $399 for the PS5 and PS5 DE.

Well the estimates I put there are using the $450 BOM price which has been leaked/ rumoured. That would be $80 higher than PS4.

[kitler53]

45 million ps+ subscriptions.    that's in the ballpark of 2 to 3 billion a year in revenue.

i really don't see a world in which MS drops the subscription requirement for online multiplayer and only has gamepass as a subscription for their games.  i know there is a lot of "smoke" but i just can't see MS turning their back on all that money.  gamepass will never reach these kinds of numbers without the online mp requirement.   ..it's more likely that MS removes gold and locks online mp behind gamepass honestly.

[DerNebel]

45 million ps+ subscriptions.    that's in the ballpark of 2 to 3 billion a year in revenue.

i really don't see a world in which MS drops the subscription requirement for online multiplayer and only has gamepass as a subscription for their games.  i know there is a lot of "smoke" but i just can't see MS turning their back on all that money.  gamepass will never reach these kinds of numbers without the online mp requirement.   ..it's more likely that MS removes gold and locks online mp behind gamepass honestly.

MS sees Xbox as a loss leader at the moment. The entirety of MS made about $40 billion in profit last fiscal year, if Xbox is profitable at all then that profit is still such a miniscule part of the whole operation that they likely don't give a shame about cutting that for a couple years in favor of working towards their braindead "2 bilion gamers" target. As they have said several times "Xbox has the full backing of MS".

They are currently going for being the cheapest option around until one day they have enough marketshare and power in the market that they can start charging more and also paying less to indies and third parties (in regards to Gamepass).

[the-pi-guy]

Sony shares quarterly unit sales of total first-party titles in financials for the first time (FY18, FY19 & Q1 FY20) | ResetEra

To my knowledge, this is the first time ever that Sony has shared how the first-party overall portfolio performs relative to total software sales on their platform in their financials, outside of PR.

 

 FY18: 17.6% of total software sales
 Notable first party releases during FY18:
 - God of War
 - Detroit Become Human
 - Marvel's Spider-Man
 - MLB The Show 19
 - Astrobot Rescue Mission

 FY19: 16.1% of total software sales
 Notable first releases during FY19:
 - Days Gone
 - Death Stranding
 - Concrete Genie
 - Blood & Truth
 - MLB The Show 20
 - Dreams
 - Nioh 2 ( uncertain if it's counted, as it's published by SIE in the west )

 Q1 FY20: 20.3% of total software sales
 Notable first-party releases:
 - TLoU Part II
 - Predator Hunting Grounds  

[/size]

It's crazy Sony can pull ~20% of games sold.