Sony raises price of PlayStation 5 console due to soaring inflation
In this photo illustration a PlayStation 5 logo displayed on a smartphone.
Mateusz Slodkowski | SOPA Pictures | Light Rocket via Getty Images
Sony on Thursday raised the recommended retail price of its PlayStation 5 game console in several international markets, citing the global economic environment, including high inflation.
The Japanese gaming giant said the price increases are effective immediately except in Japan where they will begin on September 15.
Sony isn’t raising the price of the PS5 in the US
“The global economic environment is a challenge that many of you around the world are no doubt familiar with,” Sony said in a blog post. “We are seeing elevated global inflation rates, along with unfavorable monetary trends, which are impacting consumers and creating pressure on many industries.”
The company said that “based on these difficult economic conditions”, it has decided to increase the price of its flagship console.
Here are the increases and new prices for the PS5:
- Europe: 50 euros ($50) increase to 549.99 euros for the disc version and 449.99 euros for the digital version
- UK: £30 increase to £479.99 for disc version and £399.99 for digital model
- Japan: increase from 5,000 yen to 54,980 yen for the disc version and 44,980 yen for the digital model
- China: increase from 400 yuan to 4,299 yuan for the disc version and 3,499 yuan for the digital model
- Australia: AU$50 increase to AU$799.95 for disc version and AU$649.95 for digital model
- Mexico: 1,000 Mexican pesos increased to 14,999 Mexican pesos for the disc version and 12,499 Mexican pesos for the digital model
- Canada: 20 Canadian dollars increases to 649.99 Canadian dollars for the disc version and 519.99 Canadian dollars for the digital model
Sony’s price hike comes amid a slump at games companies including Nintendo and Microsoft, which saw sales plummet in the second quarter as the pandemic-induced boom begins to fade.
Sales for Sony’s games unit were down 2% year-on-year in the June quarter, while operating profit fell nearly 37%. The Japanese giant has also lowered its annual profit forecast for its games division.
Sony is also facing ongoing supply chain issues that are making it difficult to manufacture enough PS5 consoles to meet demand. There has been a noticeable shortage of PS5s around the world.
Rival Xbox, which is made by Microsoft, has yet to announce a price hike.
Considering “the supply of the PS5 has been severely limited since launch, with many consumers unable to purchase Sony’s latest console, and the fact that Microsoft has yet to show any indication increase in its Xbox Series price, there is no doubt that this price increase will have been a difficult decision to make,” Piers Harding-Rolls, research director at Ampere Analysis, wrote in a note Thursday.
“However, with inflation and price increases being felt through the component supply chain, much of which is denominated in US dollars, as well as continued high distribution costs, Sony has now had to pass some of these cost increases to try to maintain the profitability of its hardware targets.”
Ampere Analysis estimates that Sony has sold 21 million PS5s worldwide, compared to 13.8 million for Microsoft’s Xbox Series consoles.
Harding-Rolls said he doesn’t expect this to put off gamers looking to buy a PlayStation 5 given that demand remains high.
“While we believe some consumers who have tried to buy a PS5 without success, or saved up to buy the console just in time for the price to rise, the strong pent-up demand for Sony’s device means that this a price increase of around 10% in most markets will have minimal impact on console sales,” he said.
“We expect Sony’s sales guidance for the PS5 to remain unchanged.”