Sony pockets tariff refunds as PS5 sales trail PS4 pace at 95.3 million units

Sony's Q1 2026 earnings — covering April through June — show a 37% jump in operating income for its Game & Network Services division, with US tariff refunds and favorable exchange rates cited as the main drivers. The company is keeping those refunds rather than passing them back to consumers who paid higher prices.

PS5 lifetime sales have reached 95.3 million units, but the console is losing ground to the PS4's historical pace — the PS4 had already crossed 100.2 million by the same point in its lifecycle. Sony sold 1.6 million PS5s last quarter, a marginal improvement over the 1.5 million the previous quarter but a sharp 36% drop year-on-year. Hardware revenue is down nearly 10%, while software unit sales crept up from 65.9 million to 66.1 million. Monthly active users rose by 2 million to 125 million. Digital game sales climbed from 78% to 82% of total software sales, even as Sony's decision to go fully digital by 2028 drew widespread criticism. Sony also confirmed it has secured enough RAM to cover its PS5 manufacturing targets for the rest of the calendar year — a notable statement given the ongoing memory shortage driven by AI and data center investment that has pushed component prices up industry-wide.

The tariff refunds stem from a US Supreme Court ruling that declared Trump-era tariffs unlawful. Sony raised PS5 prices twice in response to those tariffs — first in August 2025, then again in May 2026 — citing broad pressures in the global economic landscape rather than tariffs alone. A class-action complaint has since been filed, arguing Sony passed those costs onto consumers and should now return the refunds; if successful, anyone who bought a PlayStation console from August 1, 2025 onward could be entitled to compensation. Nintendo is in a similar position — a separate class-action suit filed in April 2026 makes the same argument, and Nintendo has pushed back, saying customers were never forced to buy and received exactly what they paid for. Microsoft, meanwhile, enacted another price hike in June after console storage and memory costs more than doubled, and expects another doubling of component prices in 2027.

The next few months are critical for Sony — GTA 6's release is expected to drive a meaningful hardware sales bump heading into the holiday season, which could help close the gap with the PS4's lifetime numbers. Whether any legal pressure eventually forces Sony to share those tariff refunds with consumers remains an open question, but the company has made no indication it plans to do so voluntarily.