PSP sales 'solid, not spectacular'

[Kane Knight]

PSP sales 'solid, not spectacular'
Analyst: After one week, specialty retailers are sold out, but others have plenty on hand.
March 31, 2005: 11:54 AM EST
By Chris Morris, CNN/Money staff writer
NEW YORK (CNN/Money) - Sony's PSP might be a hit with critics, but consumers seem slightly less enthusiastic about the portable gaming machine.

Only 50 of 150 retailers surveyed by American Technology Research reported sell-outs of the PlayStation Portable in its first week. Analyst P. J. McNealy described the launch as "solid but not spectacular".

Of the 100 stores AmTech surveyed that were not sold out of PSPs, 15 reported having three units or less. Others reported higher levels, with some having as many as 100 in hand.

"We believe that the PSP has come close to shipping its target1 million units in North America, with a range of 475,000 to 575,000 sold to date in the U.S. with roughly another 250,000 to 300,000 in the channel," wrote McNealy, who said he still believes Sony will sell 4.5 million to 5.5 million PSPs in North America this calendar year.

Sony (Research) has not released any official sales numbers for the PSP.

The Nintendo DS, which many say the PSP competes with, sold 500,000 units in its first seven days on the market in North America. The DS, however, went on sale during the 2004 holiday season which is typically a much busier sales period.

Specialty retailers, such as GameStop (Research) and Electronics Boutique (Research), are generally sold out of the PSP, according to McNealy.

Many big box stores, such as Wal-Mart (Research) and Target (Research), received more PSPs than they had been expecting and still have inventory in many locations. Other retailers, such as Toys R Us (Research) and Circuit City (Research), he wrote, still have inventory.

"We are hesitant to draw any macro-level conclusions about the success or failure of the PSP and impact on the video game publishers simply because we are onlyseven days into the PSP launch in North America," said McNealy.

"To put this in perspective, while the PSP has been launched amidst much hype, the expected financial impact on the video game publishers for the March quarter has been minimal and, in our opinion, is more of a case of headline risk than actual material impact right now," he wrote.

Sony's (Research) U.S. shares edged higher in morning New York Stock Exchange trading.


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