Sony wants to improve PlayStation profit margins with more aggressive PC release strategy

Sony president and PlayStation chairman Hiroki Totoki wants the company to be “aggressive” when it comes to improving its gaming division’s profit margins, which he says can partly be achieved with a greater focus on bringing first-party games to PC.

During a Q&A session following Sony’s latest financial results briefing, Totoki was asked why the game division is seeing an increase in gross income but not in profits, and whether there were any initiatives planned to improve the bottom line.

Totoki replied that there were two main factors he wanted to focus on – hardware and first-party games.

In terms of hardware, he noted that “cost reduction in this console cycle is really difficult to come by” compared to previous generations, due to the increased price of components, and implied that console prices wouldn’t be dropping while it looked for ways to improve margins.

“How can we, given the situation, put our product lines together to make it affordable, without relying on steep discounts, to reasonably sell them to continue our commercial journey on a sustainable basis?” he asked. “I personally think that’s important, and there is an opportunity in that.”

Totoki then addressed the topic of first-party games, and made it clear that he feels releasing them “multi-platform” (which he seemingly clarified as meaning PC) continues to be the way forward.

“In the past, we wanted to popularise consoles, and a first-party title’s main purpose was to make the console popular,” he explained.

“This is true, but there’s a synergy to it, so if you have strong first-party content – not only on our console but also other platforms, like computers – a first-party [game] can be grown with multi-platform, and that can help operating profit to improve, so that’s another one we want to proactively work on.

“I personally think there are opportunities out there for improvement of margin, so I would like to go aggressive on improving our margin performance.”

Sony is in the process of ramping up the number of first-party games it brings to PC, although they usually arrive some time after their PS5 release. Earlier this month, however, Helldivers 2 released for PS5 and PC on the same day.

The result was PlayStation Studios’ highest concurrent Steam player record yet, with more users playing Helldivers 2 at the same time on PC than was previously achieved by ports of more high-profile Sony IP such as God of War, Horizon Zero Dawn and The Last of Us Part I.

In 2022, PlayStation Studios head Hermen Hulst said he thought Sony’s future console games would have to wait “at least a year” before coming to PC, aside from live service titles.

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While Totoki did not explicitly say that Sony has plans for more day-and-date PC releases of PS5 titles, his comments may suggest a change of policy is being planned.

Totoki assumed the role of chairman of Sony Interactive Entertainment last October, ahead of CEO Jim Ryan’s retirement, and will act as interim CEO of SIE from April 1, so will be taking a more hands-on approach with the company’s games division.