Sony Group Corp (NYSE:SONY) is reportedly developing a new handheld gaming console designed to compete in the growing portable gaming market.
The device, which aims to offer native gameplay for PlayStation 5 titles, is still in its early stages and may take years before hitting the market, the Verge reports.
Nintendo (OTC:NTDOY) and Microsoft Corp (NASDAQ:MSFT) are among Sony’s key rivals in this segment.
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As of November 2024, the PlayStation 5 reached approximately 5.27 million units sold in Japan, significantly outpacing the Xbox Series X, which sold around 310,000 units as per Statista. Sony and Microsoft introduced their latest gaming consoles in November 2020, with both companies also offering budget-friendly versions. The PlayStation 5 Digital Edition trailed the standard model in popularity, while the Xbox Series S outperformed the Xbox Series X in sales. Additionally, Sony’s PlayStation 5 Pro, launched in early November 2024, achieved sales of about 90,000 units within its first two weeks.
Nintendo, a dominant player in handheld gaming, is preparing to launch the next generation of its Switch console next year, per the report.
Meanwhile, Microsoft is exploring a portable Xbox prototype, though its release is likely years away. The category also sees increased activity from PC-based devices like Valve’s Steam Deck and Asus’ ROG Ally, which have expanded gaming on the go.
Sony plans to build on its existing hardware with this new console. Unlike the PlayStation Portal, which streams PS5 games via Wi-Fi, the upcoming device will run games natively, broadening its potential audience and providing enhanced gaming flexibility.
This new project is not Sony’s first venture into portable gaming. The company previously released the PlayStation Portable and PS Vita, which gained a dedicated fanbase but were ultimately discontinued.
The global market for console and handheld gaming software is valued at $48.2 billion in 2023 and is expected to grow to $64.4 billion by 2030, reflecting a compound annual growth rate (CAGR) of 4.2%.
Sony Group stock gained close to 14% year-to-date.
It announced fiscal second-quarter 2024 consolidated sales rose 3% to $19.44 billion (2.91 trillion Japanese yen), falling short of analyst expectations of $19.62 billion. However, the company exceeded profit forecasts, posting EPS of $0.37, compared to the anticipated $0.27.
The Game & Network Services (G&NS) division reported a 12% increase in revenue to ¥1.07 trillion while operating income surged 184% to ¥138.8 billion. Sony sold 3.8 million PlayStation 5 units during the quarter, a decline from 4.9 million sold in the same period last year.
Sony expects fiscal 2024 sales of $87.05 billion, above the analyst estimate of $84.85 billion.
Sony is reportedly exploring the acquisition of Japanese publisher Kadokawa Corp., a move that would bolster its gaming and anime presence. Acquiring Kadokawa would give Sony access to a vast intellectual property portfolio, including popular manga, anime, and films, and a stake in FromSoftware Inc, the studio behind blockbuster games like Elden Ring and Bloodborne.
Price Action: SONY stock is up 0.73% at $19.19 premarket at last check Monday.
Photo via Shutterstock
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