Expected drop in PS5 sales due to generative AI and rising prices

Sony has recently released its financial results for the past fiscal year and is now reporting an expected decline in PlayStation 5 (PS5) sales over the next 12 months. The report clarifies that this drop is expected between April 2026 and 2027, which could be a worrying development for the gaming community and for Sony as a company.

Explanation for the decline

Sony explained that its forecast for lower PS5 hardware sales is based on the availability of memory at reasonable prices. The company says hardware profitability is expected to remain roughly in line with fiscal year 2025. This matters because the pricing and availability issues are directly tied to the recent rise of generative AI technology.

Impact of the memory crisis

The growing demand for generative AI technology has led to a shortage of memory components, which in turn has caused both higher prices for gaming hardware and reduced availability. This issue is not unique to Sony; Valve has faced a similar problem, recently attributing the absence of Steam Decks to the AI boom and announcing delays to Steam Machines for similar reasons.

Nintendo and future price increases

The revelation of declining PS5 sales also comes as Nintendo announced it will raise the price of the Switch 2 in the United States. These parallel price hikes point to a broader industry trend, where rising costs and production issues are putting pressure on innovative technologies.

Ongoing memory supply issues and the potential for higher PS6 prices point to a challenging period for the gaming industry. As hardware makers navigate the costs and availability of critical components, it will be important for gamers to stay alert to how these developments may affect their buying decisions.

Amid all these challenges, Sony does offer one positive note by forecasting that first-party game sales will increase this fiscal year. That gives current PS5 owners hope that more major titles are on the way, potentially making the investment worthwhile — if they can afford a PS5 or the upcoming consoles.