Why Did PlayStation Ditch Kojima? Analysts Suggest Sony May Have Been 'Spooked' by Death Stranding 2 Sales
· IGN
As the dust settles on PlayStation's bombshell announcement that it has ditched Physint, an ambitious-sounding next-gen project from legendary Metal Gear Solid creator Hideo Kojima, analysts are now discussing why Sony may have walked away.
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Physint will, of course, remain in production — though now backed by PlayStation's archrival Xbox, in a significant and much-needed PR win for Microsoft's gaming division.
Sony, meanwhile, is being seen as backtracking on yet another big public moment — this time, the enthusiastic handshake between PlayStation Studios boss Herman Hulst and Kojima that heralded Physint's announcement — even as fan complaints continue over PlayStation's disc-killing initiative, and disquiet over the shutdown of Destiny 2 development.
Why risk further backlash? For Dr. Serkan Toto, CEO of Japanese games industry consultancy firm Kantan Games, sales of Kojima's most recent title Death Stranding 2: On the Beach may be to blame.
"Kojima games have a strong platform marketing halo effect and are not about sales alone, but it seems the steep drop-off from DS1 to DS2 spooked Sony enough to cut him off," Toto wrote in a post on X/Twitter this morning.
Direct comparison between Death Stranding 1 and 2 is difficult as official sales for the latter were never announced by Sony or Kojima Productions "This is of course not a good sign," Toto noted, speaking to IGN.
Today, a fresh sales estimate from Alinea Analytics has pegged Death Stranding 2 at 2.5 million copies. This is a far cry from the number of players who tried the original Death Stranding — around 20 million, but there are caveats here.
Here's what we know for certain: that Death Stranding 1 had sold 5 million copies by March 2021, and had 20 million players by March 2025 — a figure that includes those who accessed the game via subscription services like Xbox Game Pass, or who claimed it free via Epic Game Store promotions. In July this year, Kojima Productions stated that the Death Stranding franchise had reached a cumulative 27 million players across both games.
Sales analysis, again from Alinea, suggests that Death Stranding 2 sales have now slowed to a trickle, that several notable discounts on the game have failed to move the needle, and that revenue for the game remains lower than that of its predecessor.
The picture that emerges here is one of a sequel that failed to build upon or even match the sales and reach established by Death Stranding 1. Perhaps this was enough to "spook" Sony, as Toto suggested, especially as both projects feel like lavish productions, with lengthy development cycles and Hollywood stars in key roles.
Looking ahead to Physint, it's possible Sony felt that the juice needed to fund a similar production scale and length was simply not worth the squeeze — especially as Physint looks to be even more ambitious, with yet more famous actors involved. Last year, Kojima estimated the game was still 5-6 years from completion, and there have been teases that some form of movie production is also involved.
All of these issues will now be Microsoft's to solve, though as Toto noted, the financial costs involved will be balanced somewhat by the positive impact this news has for Xbox as a brand, especially after a summer of layoffs, studio closures, and its own set of project cancelations to focus on games more likely to move the needle. While Physint may still be half a decade away, it is now a marquee title (and potential console exclusive) for Xbox's next-gen Project Helix.
"This doesn’t look great for PlayStation among core gamers," noted Alinea Analytics analyst Rhys Elliot today. "Especially right now. From a strictly financial perspective, though, I can understand Sony’s position. In a vacuum, anyway.
"Ballpark math: word on the street is that the first Death Stranding cost about $100 million to make, and the second somewhere in the $150 million – $200 million ballpark (longer dev cycle, COVID, and all that)," he continued. "Depending on marketing overhead and the opportunity cost of pulling those Guerrilla developers onto DS1, the franchise has almost certainly broken even – but not by much.
"Margins are the name of the game now," Elliot added, suggesting that recent key misses from PlayStation Studios have made the company more cautious over which big-budget projects it backs. "Over the past few years, scares like Concord (cancelled, $300 million+ down the drain) and softer sales from the likes of Marathon (1.8M sold), Saros ($61M), Marvel Tokon (725K, $49M), and Lego Horizon Adventures (under 250K across Steam and PS5, $11M) seem to be making PlayStation more wary."
But while ditching Kojima will likely save many further millions, the optics of losing such a prestige project are uncomfortable at best, especially after the recent online ruptions over Bungie and physical media. "The PR miss of Xbox scoring off Sony’s stumbles could have been avoided," Elliot noted. And, as The Game Business' Christopher Dring noted on X/Twitter today: "You don't sign a Kojima game for the profit margin. It's a credibility play. Strong win for Xbox."