During May in Japan, Sony's (NYSE: SNE) PS3 sold only 20% of the units that the Nintendo Wii did. According to Enterbrain Nintendo sold 251,794 units of the Wii in May, compared with 45,321 units of the PS3 sold. Sony has said that a turnaround in its gaming business is key to its profit forecasts for fiscal 2008 which began in April.
The Wii sells for about $250 in the US compared to nearly $600 for certain versions of the PS3. The slow sales of the Sony product could also hurt game developers like Electronic Arts (NASDAQ: ERTS) who have invested substantial sums in software development for PS3 games.
The poor sales numbers also raise the question of whether Sony has permanently lost the crown as the world's largest maker of video game consoles. At this point, both the Microsoft (NASDAQ: MSFT) Xbox 360 and Wii outsell PS3 in most markets. Sony's Playstation 2 continues to sell well, but the Japanese company is not betting its future on an aged product.
Sony's financial projections for the current year may already be looking like a stretch.
Douglas A. McIntyre is a partner at 24/7 Wall St.
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