Sony's PlayStation 5 sales fell off a cliff in the fourth fiscal quarter, with just 1.5 million units sold — a 46% drop from the same period last year [1][2]. The company also warned that annual gaming revenue would slide 6%, as it grapples with price hikes and memory supply constraints [6][7].
Price Hikes and Economic Pressures
Sony raised the price of the regular PS5 twice over the past year, from $499.99 to $649.99 [3][4]. In March, the company blamed "continued pressures in the global economic landscape" for the increases [5]. The higher prices appear to have dampened demand, contributing to the steep sales decline.
Memory Procurement and Future Outlook
Sony plans to base PS5 hardware sales in fiscal year 2026 on the volume of memory it can procure at reasonable prices [7]. The company expects hardware profitability in FY26 to be essentially the same as FY25 [8]. In February, Sony revealed it had secured "the minimum quantity necessary" of memory to manage the year-end shopping season [9].
For the full 2025 financial year, Sony sold 16 million PS5 consoles, down from 18.5 million in the prior year [10][11].
Industry-Wide Slowdown
Sony is not alone in facing headwinds. Microsoft's Xbox hardware revenues plummeted 33% year over year, and its Xbox content and services dropped 5% [12][13]. Nintendo is raising Switch 2 prices by $50 on September 1st and forecasting a drop in sales over the next year [14][15].
Bungie Impairment and Struggles
Sony recorded a $765 million impairment cost against Bungie during the last financial year [16]. Sony acquired Bungie in a $3.6 billion deal in 2022 [17]. Since joining Sony's PlayStation division, Bungie has laid off hundreds of workers [18]. The studio also delayed its extraction shooter Marathon after lackluster alpha test feedback [19]. Additionally, an artist accused Bungie of using their work in Marathon without permission last year, though the matter was resolved a few months later [20][21].
What to Watch Next
Sony's ability to secure memory at reasonable prices will determine PS5 supply in FY26. Meanwhile, the industry-wide price increases and economic pressures may continue to weigh on hardware sales across all three console makers.