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PS5 Sales Soar: Sony’s Latest Console Closes Gap on PS4 and Leaves Competitors Behind

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After the headwinds, the PS5 goes on the gas

Sony is taking advantage of the summer period to warm up its competitors. The Japanese group recently announced that 40 million PlayStation 5s have been sold since November 2020, an impressive figure that should be put into perspective with capitals. Although the machine is selling slightly less quickly than the PlayStation 4, with the manufacturer’s previous hardware having reached 40 million sales two months earlier in its life cycle, the PS5 has caught up most of its backlog over the course of the year 2023.

Indeed, Sony sold more than 9 million PS5s during the first half of 2023, 30% more than the peak sales – over a comparable period – of the PS4 during the last generation. In other words, even if the Japanese giant’s latest console is around a million machines behind its big sister, the PS5’s remarkable performance in 2023 helps close the gap drastically. And the price increase on many markets has not dampened the enthusiasm, quite the contrary.

Show of strength

With such results, Sony’s message is clear: generations follow and look alike. Like the PlayStation 4 in its day, the PlayStation 5 is a go-to machine for gamers and developers alike. Jim Ryan specifies that more than 2,500 games are now available on Sony’s latest console. He also insists on the upcoming arrival of expected titles such as Marvel’s Spider-Man 2, Marvel’s Wolverine, Final Fantasy 7 Rebirth and the multiplayer game taking place in the universe of The Last of Us. Yes, we are a long way from the victim stance Jim Ryan draped himself in a few months ago to coax regulators into blocking Microsoft’s proposed acquisition of Activision. Has the British leader finally moved on?

Thanks to figures recently released by Microsoft revealing that more than 21 million Xbox Series X/S have been sold worldwide, we can determine that, like the previous generation, twice as many PlayStation 5s are distributed as Xbox Series X|S. Even if it would be easy, in view of these figures, to insinuate that the Xbox Series S would not achieve its objective (a next-gen console at less than 300 euros designed to be established in as many homes as possible), we know that nearly 50% of new Xbox users are thanks to this little machine, which is something to put into perspective.

While Sony is showing remarkable performance with its latest console, Microsoft is not bragging. When publishing its financial results, the American group confirmed a 13% decrease in its hardware revenues “due to lower volume of consoles sold”. It is also amusing to see that Sony posted the figures for its PS5 only two short days after the announcement of the poor performance of Xbox sales.

False pretense

Of course, console sales remain an important indicator. We have long compared the installed base of machines in order to determine the “winners” of a generation. However, the industry has evolved. Although manufacturers are still betting on hardware, indicators show that the console market tends to shrink rather than grow. During the lawsuit between the FTC and Microsoft, Judge Jacqueline Scott Corley wrote that “consoles were no longer the future of gaming”. Today, the performance of services such as PS Plus, Game Pass and Switch Online is as important – if not more so – than the sales of pieces of plastic to plug into a screen. Subscriptions oblige, they regularly bring money into the coffers of the giants and generally generate a better margin than the strict sale of consoles.

In terms of revenue, Xbox is Microsoft’s fourth-highest revenue-generating segment in all of fiscal year 2023. Despite record sales in the fourth quarter, annual results fell short of targets due to the “weakness of first and third party content”. Nevertheless, if we rely on the figures given directly by the manufacturers for their fiscal years, we can see that gaming at Microsoft ($15.4 billion) is behind Sony ($26.7 billion) but well and truly ahead of Nintendo ($12 billion). Sure, revenue isn’t everything and doesn’t necessarily show how healthy a segment is (only profits really matter), but it’s still an important indicator.

In addition, if Xbox sales tend to decrease, the revenue earned increases, which proves the superficiality of focusing solely on hardware to gauge a manufacturer’s strategy. Although the American juggernaut did not indicate the total number of Game Pass subscribers, Satya Nadella, the CEO of Microsoft, confirmed “a record number of monthly active users” for the fourth quarter of the fiscal year.

Sony’s Challenges

Last May, Sony showed that compared to the PS4 and at comparable periods, PlayStation players spent more money on PS5 accessories (+60%), subscriptions (+52%) and add-ons (+210%)., which counterbalanced the drop recorded – slight but very present – in the purchase of games (- 10%). Despite PlayStation’s good results, Jim Ryan is about to embark on a risky brand transition that he represents. The Japanese group will invest in Live Service, new IPs, PC ports, Cloud and mobile to develop.

Sony will have a hard time dealing with a Microsoft that could extend its influence in the event of a merger with Activision. Xbox would thus become the video game company with the most monthly active users, and would experience a significant boost in terms of turnover. We recall that in 2022 and 2021, the most downloaded games on the PlayStation Store were Call of Duty. If the acquisition is made, Microsoft will become one of the most important publishers of the PlayStation, as paradoxical as that may seem.

As we explained recently, Xbox aims to become “the industry leader in revenue generated in 2030″ in “doubling its turnover during this period”. This means that by 2030, the company co-founded by Bill Gates will have to grow from $16 billion in revenue to $32 billion. Of course, the integration of Activision Blizzard will help the brand at the big “X” to get closer to his goal, but that will not be enough. Satya Nadella should therefore continue to buy studios / publishers to achieve his ends. As you will have understood, despite Sony’s comfortable lead in various video game segments, we are not immune to a possible reversal of the situation in the future.

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