Sony's PlayStation Q1 Stalls as It Plans to Phase Out Physical Discs by 2028

Sony reported flat Games & Network Services sales in Q1 FY26, with operating income up 37% due to tariff refunds, while higher platform and restructuring costs weighed on overall earnings. First‑party game sales declined while non‑first‑party software rose; hardware sales fell 10% and PS5 unit sales dropped to 1.6 million from 2.5 million. MAUs reached a record 125 million in June, with digital software and add‑ons driving revenue. Sony will halt physical disc production for new PlayStation titles from January 2028 and will cautiously push forward with a digital‑centric ecosystem while engaging with players. The company kept its full‑year G&NS guidance near 4.5 trillion yen in sales and 660 billion yen in operating income and has secured enough memory to meet projected hardware demand.