Update: The original piece below conflated console shipments to stores with actual sales of consoles to consumers. All the numbers discussed in this piece are shipment figures as reported by Sony in quarterly earnings reports. Other reports focused on sellthrough show slight growth for the PS4 in 2017, owing to differences in when units are shipped and when they are sold to consumers. Ars regrets any confusion.

Original Story

After the relative disappointment of the PlayStation 3, the PS4 has been an unquestioned sales success for Sony. The system has raced to ship an impressive 76 million units worldwide through the end of 2017, and it maintains a dominant position over the Xbox One in the high-end console sales race (though Microsoft claims not to care very much about that relative positioning).

But Sony’s quarterly earnings report last night contained a bit of a gray cloud for the PS4’s longer-term prospects. For the first time since its launch, shipments for the PS4 in the all-important holiday quarter were down year over year, from 9.7 million in 2016 to 9 million in 2017. The decline means calendar year shipments for the PS4 were flat from 2016 to 2017, sitting steady at 19.4 million.

It seems likely that Sony’s annual shipments for the PS4 will never climb higher than that number based on historical analysis. Looking back over the trajectories for the last three PlayStation systems, annual shipments tend to peak after the system’s third or fourth full calendar year on the market (not counting the partial launch year; varied launch dates throughout the year make precise day-and-date-aligned comparisons a bit tricky). With the end of 2017, the PS4 has reached the end of its fourth full year on the market, and the console seems set to begin its long decline in annual sales (Fig. 1).

That’s not to say the PS4 is going away any time soon. The system will likely drop off from its peak slowly over the next few years before hitting a market near-saturation point where relative annual shipments fall more precipitously (Fig. 2). PS4 software sales will likely continue to increase as the base of players with systems in the home continues to grow, too.

Generationally speaking, though, we’ve probably hit the functional midpoint of the PS4’s shipping cycle if history is any guide.

What sales may come

Of course, things might be different this time around. The late 2016 launch of the PS4 Pro could fundamentally shift the market, giving the PS4 family longer legs and a higher peak than previous generations. A surprise killer app could push PS4 sales to unexpected new heights in the coming year, too, as games like Nintendogs and Pokemon have done for Nintendo portables.

More likely, however, the PS4’s shipment peak starts the long countdown to the PlayStation 5, which history suggests should restart the cycle of console boom and bust in the next three or four years (that’s assuming that Sony doesn’t keep the current generation limping along with some sort of PS4 SuperPro, of course). How soon Sony decides to pull the trigger on that hardware refresh depends a lot on how quickly the PS4’s sales pace drops from here on out.

If the PS4 has peaked, it does so at a slightly lower annual shipment level than either the PS1 or PS2 (though that’s after the PS4 sold much faster than either out of the gate). Direct comparisons of total units sold can be a bit tricky in retrospect—both the PS1 and PS2 faced less serious competition from other console makers, but the total size of the console gaming population was also smaller during their heyday.

Thus far, however, the PS4 has shipped slightly more both the PS1 and PS2 at roughly the same point in their lifetimes (Fig. 3). Whether Sony’s latest console goes on to become its best selling ever depends on just how quickly shipments drop from what is likely a current annual peak. In any case, the PS4 is already on the verge of outpacing the PS3’s lifetime shipments,with plenty of good years left on the clock.

(Note: Late-term PS3 shipments in the above charts are estimated from spotty quarterly shipment data released by Sony late in the system’s life.)

https://arstechnica.com/?p=1253661