New Delhi

Sony is shifting its focus to user engagement and recurring revenue streams while PlayStation 5 hardware sales slow.

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On Thursday, Sony announced that PlayStation 5 users are spending approximately 25 per cent more compared to the PlayStation 4 era, thanks to increased spending on add-on content and subscription services like PlayStation Plus.

"This behaviour underpins the durable, predictable nature of our revenue base," noted Hideaki Nishino, a senior gaming executive, during a strategy briefing.

This increased engagement is crucial as Sony struggles with reduced hardware sales and other industry challenges.

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Sony has restructured its gaming business management, addressing investor concerns over weak margins.

Starting next month, Nishino will take on the role of CEO of the platform business group.

This restructuring comes as Sony forecasts lower PlayStation 5 sales, anticipating 18 million units in the current financial year.

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This projection follows a near miss of its revised target of 21 million units in the previous year.

The gaming industry is facing hurdles, including high development costs for major titles and a general slowdown in growth.

In response, companies are laying off employees and halting projects.

Despite these challenges, Sony has found success with live service games like "Helldivers 2," which has sold over 12 million units since its February release.

Herman Hulst, who will become CEO of Sony's studio business group, underlined the company's strategy of releasing live service games simultaneously on PS5 and PC.

This approach aims to broaden the reach and engagement of these titles.

Sony, traditionally known for its single-player games, has also released a PC version of the acclaimed "Ghosts of Tsushima" this month, a game that originally launched in 2020.

Sony's emphasis on user engagement and recurring revenue is a move to stabilise its gaming business amid fluctuating hardware sales and industry volatility.

(With inputs from Reuters)