Sony Games Division Slashes Losses

Sony Corp is expected to report that operating profits have grown to more than 380 billion yen, which means around $3.6 billion. The main element fueling the growth in profits is the boom in the high end digital camera market, but the games division of Sony also pitched in by reducing its operational losses in the fiscal year of 2007.

Even as the stock market is likely to give Sony grief over the fact that it missed performance estimates that the company itself produced a while ago, it seems that Sony is beginning to stabilize the games division and this might end up being big news for the people playing games on PlayStation consoles.

In the fiscal year that ended in March 2007 the same games division posted a loss of more than 232 billion yen, which was the equivalent of half a billion dollars. Most of the costs were generated by the need to create new technology necessary for the development of PlayStation 3 games. At the time, many analysts declared that the loss was a sure sign that the PS3 would not stand a competitive chance in the console war with the Xbox 360, mainly because of the lack of attractive games.

The games division bounced back after the next gen console from Sony was launched, reporting that in the fiscal trimester ending on December 2007 they had an operating profit of 12.9 billion or 125 million dollars.

The videogame division is expected to reduce the operating loss overall by about 100 billion yen in the year that ends in March 2008, helping Sony in general deliver a good performance.

If the trend continues, we might see more resources put by Sony into internal games development, with more emphasis on original intellectual property and promotion. This could mean better games for the PS3, which in turn could lead to better sales for the console and more profit for Sony.

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