PS3 Sales Surge 44% as Sony's Game Division Sees Holiday Profit

It's no secret that Sony's been struggling through some tough times. A sour global economy, increasing competition in electronics like HDTVs, and the enormous cost of the PS3 have all dragged Sony's bottom line way down. Today, however, following four  straight quarterly losses, Sony bounced back with a profit for the October-December quarter, posting a 660 percent increase in net income to 79.2 billion yen ($871 million). Sales also rose 3.9 percent to 2.24 trillion yen ($24.6 billion). 

Although sales in the electronics division were still down 10 percent, the division was profitable thanks to cost cutting. One of the big winners, though, was Sony's Networked Products and Services business, which includes the PlayStation business and Vaio computers. PS3 sales surged 44 percent during the quarter, growing from 4.5 million units sales to 6.5 million. As has been noted before, the price cut back in September along with the new slim model PS3 really did the trick. The worldwide installed base for PS3 is now at 33.5 million.

PS3 was finally a bright spot for Sony. The same could not be said for the PSP and PS2 businesses. The PSP sold just 4.2 million units, down from 5.1 million for the same quarter a year ago. And PS2 sales decreased from 2.5 million units to 2.1 million. PS3 software sales increased from 40.8 million units to 47.6 million, while PS2 software sales dropped precipitously from 29.7 million units to 11.2 million.

Overall, profitability was improved at the games division, thanks to lower manufacturing costs for PS3. Sony's Networked Products division saw a 1.9 percent gain in sales to 606 billion yen, while operating profit came to 19.4 billion yen, versus a loss of 5.9 billion yen a year earlier.

Thanks to a better than expected third quarter, Sony altered its forecast for the full year. The company now expects to lose 70 billion yen for fiscal 2009 (it previously had forecast a 95 billion yen loss). Sales are still expected to come in at 7.3 trillion yen for the year, which would represent a 6 percent decline.