Sony's PlayStation 5 sales have taken a nosedive, with the company reporting just 1.5 million units sold in its latest fiscal quarter, marking a staggering 46% drop year over year.

The decline is partly attributed to successive price increases, driving up the regular PS5 from $499.99 to a whopping $649.99. Sony has blamed these hikes on 'continued pressures in the global economic landscape,' including an ongoing memory crisis and tensions following the war in Iran.

In a bid to shore up its finances, Sony forecasts that gaming revenue for fiscal year 2026 will see a 6% drop due to high memory costs. The company plans to base PS5 sales on available memory procurement at reasonable prices, aiming for hardware profitability similar to the previous fiscal year.

Global competition remains fierce with Microsoft's Xbox and Nintendo's Switch also facing challenges, including declining revenue and price hikes. Sony has even had to deal with its own struggling studio, Bungie, which is currently navigating through layoff issues and delays in upcoming releases following a contentious dispute over intellectual property rights.