It looks like the cost of the PlayStation 3 is causing Sony a few headaches, with production costs and price imbalances having cost Sony over USD 3 billion since the consoleâ€™s introduction.
Sonyâ€™s fiscal 2008 report painted a rather costly picture for Sonyâ€™s investors, describing how selling the PS3 for less than it cost to manufacture resulted in Sony losing USD 2.16 billion (GBP 1.1 billion) during its 2007 fiscal year, and a further USD 1.16 billion (0.59 billion) during its fiscal 2008 year.
According to Sony, these costs stemmed from the high costs associated with â€œthe development and introductory period of a new gaming platform,â€ and warned that these costs â€œmay not be recovered.â€
The report went on to explain that developing and launching a new console is costly, and that Sony had had to invest heavily in elements such as semiconductors used in the PS3 as part of this process.
Further more, Sony also warned that these costs arenâ€™t always recouped â€œ[if a console fails] to achieve such favourable market penetration,â€ and that this may result in â€œa significant negative impact on Sony's profitability.â€
That said, it wasnâ€™t all bad news. Sony predicted that it will sell 10 million PS3s during its current financial year (with production costs falling all the time).
Meanwhile, Sony president Howard Stringer told the companyâ€™s annual shareholder meeting that one of the senior managementâ€™s top priorities was â€œto restore profitability in our game businessâ€.