Sony’s new PlayStation Plus subscriptions are off to a rocky start

The number of people subscribing to Sony’s PlayStation Plus fell from 47.3 million to 45.4 million this quarter, the company announced in its latest earnings release. It’s the subscription service’s third quarterly decline in a row, and comes despite Sony launching a revamped subscription lineup between May and June this year including new tiers that offer inclusive access to hundreds of games to download and stream. 

However, while subscriber numbers were down, revenue from “Network Services,” which includes earnings from PlayStation Plus, PlayStation Network advertising revenue, and the now-discontinued PlayStation Now, has increased from 100 billion yen to 117 billion yen (around $679 million to $794 million), year-over-year. These figures suggest Sony has less subscribers spending more money on its network services.

Sony has now sold 25 million PlayStation 5 consoles in total as of this quarter, VGC notes. It sold 3.3 million PS5 consoles between July and September 30th, which is the same number it sold in the same quarter the previous year. It sold 62.5 million physical copies of games, a reduction of almost 20 percent compared to the same quarter last year. 

The company has faced high profile supply chain challenges getting the PlayStation 5 into people’s hands, after its latest console launched in the midst of the COVID-19 pandemic in 2020. The console became a poster child of the global chip shortage, and for months was very difficult for many people to get their hands on.

Revenue from the company’s games segment was up from 645.4 to 720.7 billion yen (around $4.4 billion to $4.9 billion) year-over-year, with some of the increase due to the impact of the weak yen. But operating income fell from 82.7 billion yen to 42.1 billion yen (around $560 million to $285 million), a decline of almost 50 percent. Sony cited the costs involved with making acquisitions such as Bungie, as well as developing games more generally, as contributing to this decline. 

“Performance of Sony’s two major pillars, games and image sensors, was bad and masked by the weak yen,” Toyo Securities analyst Hideki Yasuda told Bloomberg. “PlayStation software sales continued to be lackluster and still-declining PlayStation Plus subscriber numbers are concerning.”

As a result of the challenges, Sony has cut its annual profit forecasts for its games division from 255 billion yen to 225 billion yen (around $1.7 billion to $1.5 billion), Bloomberg notes. The company recently said it’s focused on ramping up production of its PS5 console, but also plans to release more games on PC and mobile to broaden their reach. 

Across Sony in general, Nasdaq reports that operating profit was up 8 percent, beating analyst estimates. Sales of Sony’s image sensors, which are used across numerous high end smartphones, were also up.

Update November 1st, 6:12AM ET: Updated to note the increase in Network Services revenue.