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By Franklin Paul
NEW YORK, Oct 1 (Reuters) - Sony Corp’s (6758.T) PlayStation 3 video game console and its portable cousin, the PSP, are selling faster than expected and are poised to meet full-year sales targets even if the current economic crisis hurts holiday demand, Sony said on Wednesday.
Driven by solid demand by video games, and the appeal of the Blu-ray disc movie system built into the devices, PlayStation 3 sales are some 30 percent better than Sony’s plan so far in its fiscal year, according to Jack Tretton, Chief Executive of Sony Computer Entertainment of America.
As a result, he anticipates sales of the PS3 to reach a previously announced target of 10 million units by the end of the year, in March 2009.
“We are in good shape for that number worldwide,” he said in an interview. “We are tracking at 100 percent up over last year ... about 30 percent ahead of where we should be. So sales could slow down and we will still hit our number.”
Tretton said sales could be affected by products shortages, which he anticipated would be “not drastic.”
“I’d say we are able to meet somewhere between 80-90 percent demand, based on how things are trending,” he said.
Sales of the PSP, a $170 handheld device that plays games, movies and can surf the Internet, are 20-30 percent ahead of plan and are well-placed to meet the Japanese company’s target of 15 million units sold.
Sony dominated the global video game industry for a decade starting in the mid-1990s, but sales of the PS3 have lagged behind Nintendo Co Ltd’s 7974.OS Wii console. It now has to come to grips with a recent price cut for Microsoft Corp’s (MSFT.O) Xbox 360, its other main rival.
Tretton’s comments echo other industry players who suggest that the $22 billion video game industry may be relatively shielded from the economy’s troubles. Specifically, he says that multimedia devices like the PS3 and PSP have multiple uses and therefore can be enjoyed by members of an entire family, not just game players.
”I think people are going to question every dollar that they spend, but they are going to look for value in return, he said. “The entertainment value ... with PlayStation 3 compares very favorably to other entertainment choices.”
That optimism hasn’t protected Sony’s shares from declining sharply as economic concerns grow. Sony shares trading on the New York Stock Exchange have declined some 20 percent in the past month.
The stock’s decline was hastened by Wall Street analysts downgrades in mid-September, due to concerns over the outlook for Sony’s over major electronics operations, including its flat TV, mobile phone and digital camera businesses. (Reporting by Franklin Paul; Editing by Gary Hill)