Sony refuses to be drawn on whether it could raise the price of PS5

Sony has refused to be drawn on whether current economic pressures could lead the company to increase the price of the PlayStation 5.

In April Sony raised the Japanese prices of a range of consumer electronics products including some cameras, Blu-ray players, home theater systems, headphones and speakers.

It said the price revisions were being made in light of the ongoing semiconductor shortage and other external factors that have caused the cost of raw materials, manufacturing and distribution to increase.

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During its first quarter earnings call on Friday, Sony was asked whether it was considering increasing the PS5 price point in the face of similar market pressures.

“About a potential price increase for the PS5, at this point in time there is nothing specific I can share with you about prices”, came the response from executive deputy president and chief financial officer Hiroki Totoki (transcribed by VGC).

In recent months analysts have forecast that products that rely on semiconductors are set to become more expensive as chip makers increase their prices and the companies that buy them in turn pass on the costs to consumers.

Earlier this week Reality Labs announced plans to increase the price of its Meta Quest 2 VR headset by $100, a decision it attributed to rising manufacturing and shipping costs.

In May, Forrester analyst Glenn O’Donnell told CNBC he expected chip prices to rise about 10-15% in the year ahead.

“Chipmakers face their own increasing supply issues that are exacerbated by the Ukraine war … and demand remains high while supply remains constrained,” he said. “Energy prices are also on a tear, including electricity. Chipmaking requires an enormous amount of electric power.”

In turn, he forecast that manufacturers would increase the price of PCs, cars, toys, consumer electronics, appliances, and many other products.

Sony refuses to be drawn on whether it could raise the price of PS5

“Margins are already tight on such products, so they have no choice but to raise prices,” O’Donnell said.

Syed Alam, global semiconductor lead at Accenture, also told CNBC “products that use more advanced chips such as GPUs (graphics processing units) and high-end CPUs (central processing units) are likely to go up in price”.

Sony published its first quarter earnings on Friday, with the company’s Game & Network Services division experiencing a drop in sales and operating income following a significant decline in software sales.

It shipped 2.4 million PS5 units during the three months ended June 30, which is less than it had expected, but the company said there was no change to its previously announced forecast of 18 million console sales for the fiscal year.

During its earnings call, Totoki said Sony was unable to ship enough PS5s to meet consumer demand during the quarter.

“There were two big constraints that we were imposed with. One was the parts and components availability, the other was the supply chain. With the parts and components availability there are a lot of improvements so we are very hopeful, quite optimistic about that.

“For supply chain disruption, we actually took quite a hit in the first quarter. In the first quarter, hardware volume for sales were quite smaller than we expected at the beginning of the year, so supply chain disruption is something that we hope will be completely addressed.”