The newly announced PlayStation 5 price increase is likely to have “a minimal impact on sales”, data and analytics firm Ampere Analysis has predicted.
Citing the challenging global economic environment, on Thursday Sony said it had “made the difficult decision” to raise PS5 prices in Europe, Japan and parts of North America, although not the US, effective immediately.
Responding to the news, Piers Harding-Rolls, Ampere’s research director for games, predicted that pent-up demand for Sony’s console meant the company was unlikely to alter its PS5 sales forecast.
“While we believe there will be disappointment for some consumers that have been trying to buy a PS5 without success, or that were saving to buy the console just in time for the price to increase, the high pent up-demand for Sony’s device means that this price increase of around 10% across most markets will have minimal impact on sales of the console,” he wrote. “We expect Sony’s sales forecast for the PS5 to remain unchanged.”
Sony shipped 2.4 million PS5 units during its first financial quarter, which is less than it had expected, but the company said last month that there was no change to its previously announced forecast of 18 million console sales for the fiscal year.
During an earnings call, chief financial officer Hiroki Totoki said the company had been unable to meet consumer demand for PS5 due to parts and components shortages as well as supply chain issues, both of which he expected to improve throughout the year.
At the time he also refused to be drawn on whether Sony had plans to raise the PS5 price.
“Given the facts that the PS5 has been severely supply constrained since launch, with many consumers unable to buy Sony’s latest console, and the fact that Microsoft has shown no indication yet of increasing its Xbox Series pricing, there is no doubt that this price increase will have been a hard decision to make,” Harding-Rolls said.
“However, with inflation and price increases being felt through the component supply chain, much of that priced in US dollars, alongside continued high costs in distribution, Sony has now had to pass on some of those cost increases to try and maintain its hardware profitability targets.”
He added: “Although wide ranging, the PS5 price increases are relatively nuanced and are taking place in markets where the impact is being felt the most with an added layer of squeeze coming from the strength of the US dollar.
“Price increases will take place in at least 45 markets globally, but not in the US, due again to the strength of US dollar currency. The US is the biggest console market globally, and where Sony competes with Microsoft most closely for market share.”
Reality Labs increased the price of its Meta Quest 2 VR headset by $100 this month, a decision it attributed to rising manufacturing and shipping costs.
Earlier this month Nintendo claimed it wasn’t planning to raise Switch prices in Japan, despite a weak yen causing other tech companies like Apple to do so. The company told Bloomberg it didn’t intend to make its hardware more expensive, while Microsoft declined to comment.
Harding-Rolls said: “At this stage there is no indication that Microsoft will be increasing its prices for the Xbox Series console. Undoubtedly, Microsoft will take advantage of Sony’s increase to push its ‘value’ message, especially around the Xbox Series S, Game Pass and its All Access offer as we enter the holiday shopping season. As such, this move hands some advantage to Microsoft.”
Ampere Analysis previously predicted that PS5 would outsell Xbox Series X/S consoles two-to-one in 2022.