Citi flags "high price" of Sony's PS5 Pro as possible sales headwind

Investing.com -- Sony (TYO:6758 ) has unveiled its PlayStation 5 Pro, an upgraded version to its well-known console that will feature improved graphics and greater disc space.

The so-called PS5, which not include a disc drive, is due to go on sale on Nov. 7 for $699.99, the Japanese conglomerate said in a statement.

"[T]he PS5 Pro console aims to provide players with richer gameplay experiences through super sharp image clarity, high frame rate gameplay, and advanced ray tracing," Sony added.

It has previously said it expects to sell 18 million PS5 units during its current financial year, slipping from 20.8 million a year earlier.

In a note to clients, analysts at Citi flagged that while the PS5 Pro offers customers "better performance" than the regular PS5 model, its pricing "seems extremely challenging, since there has never been a game console whose successor model was substantially more expensive than the original."

They flagged that although Sony will likely continue to sell PS5s to help maintain sales, it remains "hard to see" how the PS5 Pro could drive volumes due to its elevated price tag.

"If one believes that Sony could maximize profits by extending the life cycle of the PS5 and increasing the installed base, then introducing a higher-priced model is a bad move," the analysts said.

Sony, a massive group with businesses spanning everything from gaming to chips, recently posted a 10% jump in operating profit during the quarter ended in June. During the period, the amount of PS5s sold dipped from a year earlier to 2.4 million units, although it still managed to garner a larger profit from its games operations.

The firm also increased its annual profit outlook by 3% to 1.3 trillion yen thanks in large part by a strengthening in the yen.

Reuters contributed to this report.

Source: Investing.com