Sony is contemplating price increases for its products, including the PlayStation 5, in response to significant financial pressures caused by tariffs. The company disclosed its financial performance for the fiscal year ending March 2025, and during a subsequent Q&A session with investors, executives discussed the impact of these tariffs, particularly those imposed during the Trump administration.
Sony's Chief Financial Officer, Lin Tao, revealed that tariffs are expected to cost the company around 100 billion yen (approximately $685 million), primarily affecting its hardware division, which includes the manufacturing of video game consoles like the PS5. Tao indicated that Sony might pass some of these costs onto consumers by raising hardware prices. He emphasized that the company is not only considering the direct tariff costs but also market trends and shipment allocations in their decision-making process.
Sony's CEO, Hiroki Totoki, specifically addressed the PlayStation division, mentioning the possibility of manufacturing the PS5 in the United States to circumvent these tariffs. Totoki noted that while PS5 production is currently spread across multiple regions, localizing production in the U.S. could be a strategic move, although no final decision has been made.
Sony's Hiroki Totoki is considering producing the PS5 in the United States due to the Tarrifs. "It needs to be considered going forward" pic.twitter.com/c1cEQIwXA4
— Destin (@DestinLegarie) May 14, 2025
Analysts have suggested that Sony might follow the lead of competitors like Nintendo and Microsoft, who have already moved towards $80 games. There is speculation that the PS5, particularly the PS5 Pro, could see a price increase. This has prompted some consumers to purchase the console before any potential price hikes are announced.
Daniel Ahmad, director of research and insights at Niko Partners, noted that Sony has previously increased console prices in regions outside the U.S. He expressed that, despite reluctance to raise prices in the crucial U.S. market, Sony might eventually do so. James McWhirter, a senior analyst at Omdia, highlighted that the majority of PS5 hardware is manufactured in China, making Sony vulnerable to U.S. tariffs. He pointed out that significant console sales occur in the fourth quarter, giving Sony and Microsoft time to utilize existing inventories. However, with Microsoft recently adjusting prices, Sony might feel compelled to follow suit, especially in the U.S., which has historically been insulated from such increases except for a $50 rise in the PS5 Digital edition in late 2023.
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