Sony has announced it has cut its PlayStation 3 sales target for the year to March 2008 to 9.5 million units from their predicted figure of 11 million.

This climb-down on the sales figures is in strong contrast to their stance at the Tokyo Games Show last September.

Sony Computer Entertainment president Kazuo Hirai said, in his keynote speech at the event, that he believed the company

would

achieve its predicted sales target of selling 11 million units before the end of the fiscal year in March.

Worldwide, Sony sold 4.9 million units of the PS3 between October and December.

Sony has raised its PSP sales target for the current business year to 13 million units from 10. Third quarter sales were up by 1.1 million units to 5.8 million, although game sales dropped.

Sales of the PlayStation 2 dropped by 1.35 million compared to the same period of last year, but beating predictions, it outsold the PS3 with over 5 million units bought worldwide.

Overall sales and revenue were up 9.6%, but the gaming division is still in the red - and expects to stay that way for some time to come due to losses made on the PS3.

"We have reduced losses on the PS3 due to production cost-savings but don't expect the game division to become profitable until the second half of the next fiscal year", a Sony spokesperson said.