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Sony shares decline amid weak sales of gaming hardware

Sony shares decline amid weak sales of gaming hardware

Sony shares dipped 8%, on Monday, after the company announced a cut in its annual revenue guidance. The investor sentiment fell when the company mentioned the reduced sales of PS4 gaming console in the last fiscal year. In Q3 2018 Sony sold 8.1 million PS4 while in the third quarter of 2017 the tech giant sold 9 million.

Analysts say that declining operating profits of the company’s gaming division has disappointed its investors. Sony is one of the business moguls of the gaming industry. A large share of its operating income is sourced from the gaming revenue.

Analysts view that the decline in profits is due to increased spending on promotional and marketing activities to attract more customers to PS4.

While Sony’s gaming business is taking a hit, Sony’s music business is soaring. The company recorded an operating profit of $3.46 billion for a single quarter compared to the annual revenue of $3.21 received last year. This marked the highest single quarter profit for the Chinese tech giant.

Currently, gaming is considered one of the most profitable industries. Many tech giants including Apple and Chinese food retail giant, Meituan is exploring the gaming business. Also, many companies are considering gaming on blockchain. Companies like EOS and Tron have several gaming dApps built on its respective blockchain. Blockchain games reward players with crypto tokens.

Gaming dApps [Decentralized Apps] are gaining positive reception among the gaming community. Many say that “blockchain will be the next big thing in gaming”.

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