Around $10 billion of value was wiped off Sony's stock last week, after the Japanese tech giant cut its sales forecast for its flagship PlayStation 5 console for the fiscal year.
Analysts, who already thought Sony's PS5 target was too lofty, told CNBC a bigger issue for the company are its declining margins in its key gaming business.
The company's shares fell after the announcement, with around $10 billion of value wiped off the stock since the forecast cut, according to a CNBC calculation using FactSet data.
By contrast, Sony's operating margin was more than 9% in the December quarter of 2022.
"The shipment forecast cut for PS5 ... is not what is disappointing ... What is disappointing is the low level" of operating margin, Atul Goyal, equity analyst at Jefferies, said in a note to clients on Wednesday.
Persons:
Atul Goyal
Organizations:
PlayStation, CNBC, Sony, Jefferies