Fewer PS5 Sales, But Sony’s Gaming Profits Soar by 43% Thanks to Software and Services

Sony’s gaming division has posted a substantial 43% year-over-year increase in operating income, despite a noticeable drop in PlayStation 5 hardware sales.

The company’s Games & Network Services division earned ¥414.8 billion (~$2.8 billion) in operating profit for the fiscal year ending March 31, 2025, driven largely by strong software and subscription performance.

PS5 Sales Dip — But Not the Bottom Line

Sony shipped 18.5 million PS5 units, down from 20.8 million the previous year. Yet the decline in hardware sales didn’t drag down the division. Instead, network services and digital content carried the momentum.

• Gaming division net sales: ¥4.6 trillion (~$31.5 billion), up 9%

• Hardware revenue: ¥1.6 trillion (~$10.9 billion), down 6%

• Software revenue: ¥2.5 trillion (~$17 billion), up 14%

• Digital software/add-ons: ¥2.2 trillion (~$15 billion), up 16%

Sony sold 303.3 million games over the year, up from 286.3 million. However, first-party title sales dropped to 28.9 million from 39.7 million, reflecting a quieter release calendar with fewer major exclusives.

PlayStation Plus, Subscriptions Shine

Sony’s network services, including PlayStation Plus, saw revenues rise by 23% to ¥669.8 billion (~$4.5 billion).

• Monthly active users climbed to 124 million, up from 118 million year-over-year.

Cautious Forecast for FY2026

Sony expects next year’s gaming revenue to fall:

• Forecasted Games & Network Services revenue: ¥4.3 trillion (~$29.2 billion), down 6.5%

• Company-wide revenue: Expected to dip 3% to ¥11.7 trillion (~$79.9 billion)

The company cites foreign exchange rates and declining hardware sales as key reasons.

Sony plans several major game releases next financial year, including "Ghost of Yōtei," "Death Stranding 2: On the Beach," and "Marathon."

Tariff Pressures and Price Hike Possibilities

A significant concern for Sony is the potential impact of newly imposed U.S. tariffs on electronics. The company warns that these tariffs could reduce its operating income by ¥100 billion (~$680 million), pushing projected income down to ¥1.2 trillion (~$8.2 billion).

Sony says it has about three months of PS5 inventory stocked in the U.S. but is considering raising prices to offset the added cost burden.

• A recent price hike for the PS5 Digital Edition has already taken effect in Europe, the UK, Australia, and New Zealand.

• In Japan, the PS5 now costs about ¥30,000 more than at launch (~£170).

Sony CFO Hiroki Totoki also revealed the company may relocate some PS5 manufacturing to the U.S. to mitigate the tariff impact:

“Hardware can of course be produced locally. I think that would be an efficient strategy.”

Other gaming companies are facing similar issues. Microsoft recently raised prices for Xbox hardware and accessories, with some games reaching $80. Nintendo has increased prices on several accessories, but hasn't yet announced any price changes for its upcoming Nintendo Switch 2 console.