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[Woopah]

I'm curious what will happen to MKW sales once the de facto bundle is the Pokémon one. I really like MKW and I think it's the best in the series but I don't know how well it is perceived in Japan.

Speaking of Pokémon I can really see Z-A beating the absolute sales records of the series considering the gigantic install base of Switch / Switch 2.

The bundles coming to an end will slow MKW down a bit, but legs should still be strong.

I don't expect ZA to match the sales of Pokémon S/V. If it can match or exceed the sales of Legends Arceus, I'd call that a success.

I keep seeing this sentiment over and over in these threads, but I don't think PS5 consoles would fly off the shelves in Japan even if they were cheaper. The system is just too big and bulky for most people over there, and the platform is no longer in tune with their tastes, as Sony clearly chases the Western market these days.

They wouldn't fly off the shelves, but a lower price would help somewhat

When you say Sony chases the Western market, what would you like then to do to chase the Japan market? As in, what type of games should their studios be making?

 

[Mozza]

Doomed since 1983... lol

 

[yurinka]

Sony seems fubared in Japan. Maybe the handheld turns it around.

No, physical game sales are a very small portion of the total game revenue both in Japan and worldwide (and way smaller when talking about the revenue and also including addons and game subs), and Sony dominates the digital game revenue.

Sony also has around half of its active userbase still in PS4, meaning a lot of money made by their games comes from PS4, not only PS5.



Let's see the worldwide case (graphs with fiscal years, not calendar years):

• Nintendo makes a bit more revenue than Sony with physical games (162.8 bn yen last fiscal year)
• Sony makes way more revenue than Nintendo with digital game revenue, digital game sales+addons+subs (2634 bn yen difference last fiscal year)
• In the last fiscal year regarding total game revenue (a.k.a. conent and services, a.k.a. physical+digitall full game sales+addons+game subs), Sony made 3081.5 bn yen and Nintendo made 610 bn yen, a 5:1 difference in Sony's favor
• In the last fiscal year, physical sales were only a 3.93% (case of Sony) and 46.56% (case of Nintendo) of their total game revenue (a.k.a. content & services revenue, a.k.a. full game + addons + game subs sales)
• Combining Sony and Nintendo, in the last FY physical game revenue was 405.2 bn yen, 10.98% of the their total physical + digital software revenue (3691.5 bn yen)
• PS (4+5) has a 1.24:1 advantage in HW sales units over Switch (1+2) worldwide
• In digital revenue we see that late 2020/early 2021 (PS5 launch window) there's a big spike particularly in the Sony side, then goes a bit down and keeps steady during a couple years and then during a couple years goes up in the Sony side. Pattern isn't the same in Nintendo
• In physical revenue there isn't a lot of difference between the companies, combining them we see that since 2018 it has been pretty much flat was a small drop in year ending in March 2020 (pre-PS5 release) and very small peaks from April 2021 to March 2022 (Switch software sales peak year) and from April 2022 to March 2023 (PS5 software sales peak year) that more or less compensate each other. We see an important drop in April 2024-March 2025 (pre-Switch 2 + gradual decrease of PS5 physical sales since the peak), that started for PS5 a year before.

Now let's see the Japanese case, graph of Japanese gaming revenue per calendar -not fiscal- year (orange=mobile, blue=PC, green=console digital, pink=console physical) from the Famitsu White Book:

• In 2024 calendar (not fiscal) year of the game revenue in Japan (only software, not counting hardware or accesories):
  • 1,119 bn yen were physical console game revenue (4.67% of the total, 29.25% of consoles)
  • 2,707 bn yen were digital console game revenue (11.30% of the total, 70.75% of consoles)
• So physical console game revenue in Japan (this time including MS) is 29.25% of the total console game revenue, higher than the Sony+Nintendo one worldwide (10.98%), a substantial different that would be pretty smaller if in this graph aren't counting game subs
• We see digital console game revenue had a high growth in 2020, then goes a bit down and gets mostly flat during a couple years and then grows during a couple years. Pretty much the same pattern than in worlwide PS numbers, console that dominates digital game revenue
• Switch (1+2) has a 2.3:1 advantage in Japan over PS (4+5), very different than worlwide, where PS has a 1.24:1 advantage
• We see physical sales pretty much flat (matching the combined PS+SW WW sales) with the only more or less meaningful events a tiny peak in 2020 (I assume covid + Animal Crossing) and mostly a drop during 2023 and 2024 (matching WW numbers particularly of PS)

So, TLDR:

• Physical console games revenue in Japan is under 30% of the total consoles game revenue, and under 5% when also counting mobile and PC
• Over 70% of the console games revenue in Japan is digital
• In digital console games revenue Sony has a 5:1 advantage over Nintendo worldwide, and the evolution of the digital console games revenue in Japan seen in the graph is almost the same than the Sony worldwide one and very different than the Nintendo one
• Worldwide PS4+PS5 have a 1.24:1 advantage in units versus Switch 1+2, but in Japan it's very different (Switch has 2.3:1 advantage). Meaning, Switch is better positioned than Sony in Japan regarding installbase, but the distance is very small compared to the 5:1 distance Sony has in digital game sales worldwide
• Meaning, despite Nintendo having a bigger console installbase and and better physical game sales in Japan, pretty likely like in the rest of the world Sony also has a considerable advantage in digital revenue over Nintendo in Japan. And being digital revenue 70% of the total console game revenue in Japan, pretty likely PS (which remember, includes both PS4+PS5) makes more money from games than Nintendo, as also happens worldwide

 

[Woopah]

No, physical game sales are a very small portion of the total game revenue both in Japan and worldwide (and way smaller when talking about the revenue and also including addons and game subs), and Sony dominates the digital game revenue.

Sony also has around half of its active userbase still in PS4, meaning a lot of money made by their games comes from PS4, not only PS5.



Let's see the worldwide case (graphs with fiscal years, not calendar years):

• Nintendo makes a bit more revenue than Sony with physical games (162.8 bn yen last fiscal year)
• Sony makes way more revenue than Nintendo with digital game revenue, digital game sales+addons+subs (2634 bn yen difference last fiscal year)
• In the last fiscal year regarding total game revenue (a.k.a. conent and services, a.k.a. physical+digitall full game sales+addons+game subs), Sony made 3081.5 bn yen and Nintendo made 610 bn yen, a 5:1 difference in Sony's favor
• In the last fiscal year, physical sales were only a 3.93% (case of Sony) and 46.56% (case of Nintendo) of their total game revenue (a.k.a. content & services revenue, a.k.a. full game + addons + game subs sales)
• Combining Sony and Nintendo, in the last FY physical game revenue was 405.2 bn yen, 10.98% of the their total physical + digital software revenue (3691.5 bn yen)
• PS (4+5) has a 1.24:1 advantage in HW sales units over Switch (1+2) worldwide
• In digital revenue we see that late 2020/early 2021 (PS5 launch window) there's a big spike particularly in the Sony side, then goes a bit down and keeps steady during a couple years and then during a couple years goes up in the Sony side. Pattern isn't the same in Nintendo
• In physical revenue there isn't a lot of difference between the companies, combining them we see that since 2018 it has been pretty much flat was a small drop in year ending in March 2020 (pre-PS5 release) and very small peaks from April 2021 to March 2022 (Switch software sales peak year) and from April 2022 to March 2023 (PS5 software sales peak year) that more or less compensate each other. We see an important drop in April 2024-March 2025 (pre-Switch 2 + gradual decrease of PS5 physical sales since the peak), that started for PS5 a year before.

Now let's see the Japanese case, graph of Japanese gaming revenue per calendar -not fiscal- year (orange=mobile, blue=PC, green=console digital, pink=console physical) from the Famitsu White Book:

• In 2024 calendar (not fiscal) year of the game revenue in Japan (only software, not counting hardware or accesories):
  • 1,119 bn yen were physical console game revenue (4.67% of the total, 29.25% of consoles)
  • 2,707 bn yen were digital console game revenue (11.30% of the total, 70.75% of consoles)
• So physical console game revenue in Japan (this time including MS) is 29.25% of the total console game revenue, higher than the Sony+Nintendo one worldwide (10.98%), a substantial different that would be pretty smaller if in this graph aren't counting game subs
• We see digital console game revenue had a high growth in 2020, then goes a bit down and gets mostly flat during a couple years and then grows during a couple years. Pretty much the same pattern than in worlwide PS numbers, console that dominates digital game revenue
• Switch (1+2) has a 2.3:1 advantage in Japan over PS (4+5), very different than worlwide, where PS has a 1.24:1 advantage
• We see physical sales pretty much flat (matching the combined PS+SW WW sales) with the only more or less meaningful events a tiny peak in 2020 (I assume covid + Animal Crossing) and mostly a drop during 2023 and 2024 (matching WW numbers particularly of PS)

So, TLDR:

• Physical console games revenue in Japan is under 30% of the total consoles game revenue, and under 5% when also counting mobile and PC
• Over 70% of the console games revenue in Japan is digital
• In digital console games revenue Sony has a 5:1 advantage over Nintendo worldwide, and the evolution of the digital console games revenue in Japan seen in the graph is almost the same than the Sony worldwide one and very different than the Nintendo one
• Worldwide PS4+PS5 have a 1.24:1 advantage in units versus Switch 1+2, but in Japan it's very different (Switch has 2.3:1 advantage). Meaning, Switch is better positioned than Sony in Japan regarding installbase, but the distance is very small compared to the 5:1 distance Sony has in digital game sales worldwide
• Meaning, despite Nintendo having a bigger console installbase and and better physical game sales in Japan, pretty likely like in the rest of the world Sony also has a considerable advantage in digital revenue over Nintendo in Japan. And being digital revenue 70% of the total console game revenue in Japan, pretty likely PS (which remember, includes both PS4+PS5) makes more money from games than Nintendo, as also happens worldwid

The trends in Japan are different to worldwide though.

As you note, PS has a userbase and software unit sales advantage over Switch worldwide. Whereas Japan its the opposite, with Switch having the higher userbase and higher software unit sales.

And while it's true that Sony has a big lead over Nintendo in digital sales, that lead becomes a lot smaller when you take the accounting differences into account (but still big). Likewise when we say "In the last fiscal year, physical sales were only a 3.93% (case of Sony)" we again need to note that Sony counts digital revenue differently from physical revenue.

PS may very well make more MTX revenue in Japan than Switch, but we don't really know. But in terms of physical/digital software and hardware sales Switch has the clear advantage.

 

[yurinka]

The trends in Japan are different to worldwide though.

As you note, PS has a userbase and software unit sales advantage over Switch worldwide. Whereas Japan its the opposite, with Switch having the higher userbase and higher software unit sales.

The only big difference they lean more to portables. Which means their mobile gaming has a slightly higher percentage than worldwide and in consoles they lean more to portables than to home consoles compared to worldwide.

This Japan vs WW difference in hardware installbase I detailed obviously must affect the software revenue, but remember, Sony's advantage in software (particularly digital) is way bigger.

As I also detailed, worldwide PS has a worldwide advantage of 5:1 in software revenue and 1.24:1 in units, meaning a software revenue per unit of around 4 times Switch.

So if my maths aren't wrong, making a rough extrapolation estimate if in Japan Switch has an installbase difference of 2.3:1 and per unit PS also make in Japan 4x the software revenue than Switch makes, then in Japanese sofware revenue would be 2.3:4 (so 1.74:1) in Sony's favor. PS or Switch behavior per console may change a bit per console in Japan vs worldwide regarding buying games/addons/subs, changing the real difference vs the rough extrapolation estimate, but highly doubt the change would be so big to compensate that 1:74:1 difference.

So, even if in -like in worldwide- Switch would make more revenue selling physical games and having more hardware units sold, PS would have more software revenue in Japan due to their big difference per unit in digital software revenue (a huge chunk of that coming from addons).

And while it's true that Sony has a big lead over Nintendo in digital sales, that lead becomes a lot smaller when you take the accounting differences into account (but still big). Likewise when we say "In the last fiscal year, physical sales were only a 3.93% (case of Sony)" we again need to note that Sony counts digital revenue differently from physical revenue.

PS may very well make more MTX revenue in Japan than Switch, but we don't really know. But in terms of physical/digital software and hardware sales Switch has the clear advantage.

In the digital side Sony has all digital full game sales + addon sales + game subs sales reported separatedly. In the digital side, Nintendo reports digital version sales of titles also available physically as one thing, and in a separate side report together digital only games + addons + game subs. So the only way you have to compare directly Nintendo vs Sony digital revenue is counting all digital full game sales + addon sales + game subs sales.

I didn't count there Sony's software revenue outside PS ('other software', PC+Switch+Xbox+mobile revenue) and Nintendo's software revenue outside 'dedicated gaming device' Switch (mobile revenue).

To get their total software revenue, or 'content and services' revenue we add the physical game sales revenue to that digital game sales + addon sales + game subs sales revenue.

 

[Woopah]

The only big difference they lean more to portables. Which means their mobile gaming has a slightly higher percentage than worldwide and in consoles they lean more to portables than to home consoles compared to worldwide.

This Japan vs WW difference in hardware installbase I detailed obviously must affect the software revenue, but remember, Sony's advantage in software (particularly digital) is way bigger.

As I also detailed, worldwide PS has a worldwide advantage of 5:1 in software revenue and 1.24:1 in units, meaning a software revenue per unit of around 4 times Switch.

So if my maths aren't wrong, making a rough extrapolation estimate if in Japan Switch has an installbase difference of 2.3:1 and per unit PS also make in Japan 4x the software revenue than Switch makes, then in Japanese sofware revenue would be 2.3:4 (so 1.74:1) in Sony's favor. PS or Switch behavior per console may change a bit per console in Japan vs worldwide regarding buying games/addons/subs, changing the real difference vs the rough extrapolation estimate, but highly doubt the change would be so big to compensate that 1:74:1 difference.

So, even if in -like in worldwide- Switch would make more revenue selling physical games and having more hardware units sold, PS would have more software revenue in Japan due to their big difference per unit in digital software revenue (a huge chunk of that coming from addons).




In the digital side Sony has all digital full game sales + addon sales + game subs sales reported separatedly. In the digital side, Nintendo reports digital version sales of titles also available physically as one thing, and in a separate side report together digital only games + addons + game subs. So the only way you have to compare directly Nintendo vs Sony digital revenue is counting all digital full game sales + addon sales + game subs sales.

I didn't count there Sony's software revenue outside PS ('other software', PC+Switch+Xbox+mobile revenue) and Nintendo's software revenue outside 'dedicated gaming device' Switch (mobile revenue).

To get their total software revenue, or 'content and services' revenue we add the physical game sales revenue to that digital game sales + addon sales + game subs sales revenue.

We still need to take into account the difference in reporting. When Nintendo reports digital software revenue, it only includes the revenue that it gets to keep. When Sony reports digital software revenue, they report the combined revenue of themselves and every single third party publisher.

Obviously third parties make a huge amount of money from Playstation. So if we were to remove their revenue and just compare Nintendo to Sony themselves, the gap would not be 5:1.

Playstation physical unit software sales in Japan in 2024 were 4,554,550. Sony's digital ratio globally for that time was around 75%, so that would give them total unit sales of around 18,218,200.

Switch software shipments in Japan in that same period were 34,070,000. To make it like-for-like we'd have to remove the unsold physical games from that number, but then add in the sales of digital only games.

So as you can see, the unit sales gap between Switch and PS is very different in Japan vs. the worldwide situation.

 

[yurinka]

We still need to take into account the difference in reporting. When Nintendo reports digital software revenue, it only includes the revenue that it gets to keep. When Sony reports digital software revenue, they report the combined revenue of themselves and every single third party publisher.

No, they report the same: sales a.k.a. revenue, which is the money that company gets by selling stuff. In this case, a console platform holder sells directly 1st party physical games and anything on their digital store: 1st and 3rd party digital games, addons and subs.

Regarding 3rd party physical games, they aren't sold by these platform holders, so they can't account all the money paid for them as their revenue, because it's something other company sold. In that case it only counts for them as revenue the royalty these 3rd party pays them for selling/shipping a physical copy of a game for their console.

Later, after having got paid what they reported as the revenue there are several things reported as expenses they pay, which includes stuff like the 70% royalty for the 3rd party digital games/addons sales to their 3rd party publisher, servers, transaction commisions, refunds, taxes, etc.

The big difference in digital software revenue comes from Sony having a bigger active userbase (PS has in a month aprox. the same amount Nintendo has in a year) and making more average money per user, mainly with addons, selling some of their top selling games more expensive, a considertably bigger percentage of full game sales sold digitally and having way more subscriptions plus charging them at a more expensive price.

Most of these digital revenue numbers were for Sony during the FY that ended this March like twice they were in the FY that ended in March 2020 (the last one before releasing the PS5) even if they were reporting them in the same way during this period.

Playstation physical unit software sales in Japan in 2024 were 4,554,550. Sony's digital ratio globally for that time was around 75%, so that would give them total unit sales of around 18,218,200.

Switch software shipments in Japan in that same period were 34,070,000. To make it like-for-like we'd have to remove the unsold physical games from that number, but then add in the sales of digital only games.

Yes, as I mentioned Switch sells more physical games than PS worldwide. So obviously as shown in your rough estimate in Japan too, and even with a bigger difference than in worlwide because Switch has a way bigger installbase than PS in Japan (while is smaller worldwide). And on top of that Switch has a considerably bigger percent of full game sales that are physical than PS.

As explained above, this is perfectly compatible with Sony making way more total software revenue, and specifically digital revenue, both worldwide and in Japan, due to generating way, way more revenue selling digital full games, addons and game subs. More than compensating the way smaller lead Switch has in Japan (a country where over 95% of all game revenue -counting beyond console- is digital and not physical).