Sony's Profit Rises by 45% Amid Decline in PlayStation 5 Sales

Japanese Sony Group reported a 45% increase in operating profit in the second quarter of the 2026 fiscal year, despite a 35% reduction in PlayStation 5 shipments. The company raised its annual forecast but warned of rising memory costs used in gaming consoles.

Sony increased profit and improved annual forecast

According to Sony's financial report, published on November 5, the company's revenue for July–September reached 3.43 trillion yen, up 10% compared to the same period last year. Operating profit rose to 622.3 billion yen, and net profit increased by 44% to 449.6 billion yen.

One of the main sources of growth was the Game & Network Services (G&NS) segment. Its operating profit increased by 83% to 220.1 billion yen. This dynamic is partly explained by one-time expenses reflected in last year's quarter. Excluding these, growth was about 29%.

The Pictures division also improved results thanks to the successful release of the film 'Spider-Man: Brand New Day'.

Amid strong reporting, Sony raised its operating profit forecast for the fiscal year ending March 2027 from 1.72 to 1.87 trillion yen.

Expensive memory creates risks for PlayStation

Despite improved financial performance, quarterly PS5 shipments fell from 4 million to 2.6 million units. However, revenue from game sales and additional content increased to 708.5 billion yen, and network services to 218.3 billion yen.

An additional pressure factor on the gaming business remains the rising cost of DRAM and NAND memory. Increased demand for components for artificial intelligence infrastructure limits the supply of memory for consumer electronics and raises production costs.

Sony reported that it is currently offsetting the increased memory costs by adjusting prices, promotions, and reducing other expenses. The company aims to maintain PS5 hardware profitability at approximately the level of the previous fiscal year.

Moreover, Sony has agreed with suppliers on the necessary volumes of memory for projected console sales in the next fiscal year. However, the company did not disclose the cost of future purchases.

Rising component costs remain a potential risk for gaming console manufacturers, even if game and digital service sales continue to support their financial results.