PlayStation turns profitable but Sony cuts full year sales targets

PlayStation 3 cost reductions have helped Sony's game division turn a profit for the third quarter ended December 31, but the company has slashed sales targets for the full year from 11 million to 9.5 million units.

Profit for the PlayStation business was JPY 12.9 billion (USD 121 million), compared to loss of JPY 54.2 billion (USD 509 million) for the same period in 2006, with improvement attributed to hardware reduction costs and strong sales of the PSP handheld.

Sales for the game division were JPY 581.2 billion (USD 5.46 billion), a 31.2 per cent increase over 2006's JPY 442.8 billion (USD 4.16 billion)

However, the company has lowered its full year sales targets for the PlayStation 3, from 11 million units to 9.5 million, while revealing it sold 4.9 million PS3's during the October to December period.

Software sales for the PlayStation 3 reached 26 million units during the three month period.

Following the success of the PlayStation Portable during the quarter, Sony has raised sales targets for the handheld from 10 million to 13 million units.

The company also said that while profit from the PlayStation 2 business decreased, hardware and software sales for the ageing console contributed to operating profit.

Net income for the entire Sony business rose 25 per cent to JPY 200.2 billion (USD 1.88 billion), up from JPY 159.9 billion (USD 1.50 billion) the previous year. Sales were also up 9.6 per cent to JPY 2.86 trillion (USD 26.8 billion).

With the PlayStation business making a profit, the company raised its full year net income target by 3 per cent to JPY 340 billion (USD 3.19 billion), while lowering yearly operating profit forecasts to JPY 410 billion (USD 3.85 billion), down from the previous JPY 450 billion (USD 4.22 billion) estimate.

Hardware sales for the PSP during the third quarter reached 5.76 million units, an increase of 22 per cent, while software sales for the handheld slipped 14 per cent to 18.3 million units.