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[RetroGamingUK]

Next year will be the one for Xbox , I'm sure.
Their 25 year old single player Halo campaign remake will shatter sales records on PlayStation.
All of GAF will pee out of their butts.

Big games will be...

Call of Duty (first current-gen only title)
Forza Horizon 6
Halo CE (PlayStation debut)

I see Gears E-Day and Fable slipping to 2027

 

[Mownoc]

"Xbox says the 1% flat YoY is decline in 1st party games but growth in Game Pass revenue"

Worth nothing that these results are for the quarter ending September 30th, and the gamepass price rise occured on October 1st. The day after.

So will be interesting to see what the result for gamepass revenue is next quarter. Will it go up because of higher price? Will it go down after a mass exodus? I expect if there isn't growth MS will just be completely silent about it.

 

[DeltaPolarBear]

It's understandable if you put yourself in the shoes of a diehard Xbox fan and widen out the context. It's not about this one report. It's about Xbox taking punch after punch, one after another, for years.

And let's be honest, plenty of PS guys do point and laugh. Hell, I'm one of them. But if you put yourself in the shoes of a hardcore Xbox fan -- the kind of guy who is still hanging on after all this -- then it has to feel like piling on.

This only happened because Microsoft held Xbox upright with wires and 2by4s, when they should have gone down for the count 5 years ago. Instead of throwing in the towel, Xbox and its fans are forced to keep getting punched in the face until they actually died from the injuries.

Remember that most past consoles quit BEFORE retailers stopped wanting to stock their hardware. Xbox was forced to stay around getting shamed on while stores take their dusty shelf spaces away. Xbox couldn't quit with dignity so now they are an embarrassment,

 

[Hector Hall]

Truth is Ms Gaming has a plethora of income from other platforms. Games on Playstation, games on PC, Minecraft (massive on Switch), GP on PC, the income of ABK and Zenimax on other platforms, mobile with King...yet they are unable to put a profit number next to income each quarter. 30% my ass, gaming isolated is still in the red.

The actual "Xbox only" numbers in there must be pretty terrible. That's why Hood and Nadella have decided to sacrifice the deficitary side of the equation.

 

[memoryman3]

I'm surprised people don't realise that hardware sales falling is a good thing for Xbox's profit margins. And I'm sure Amy Hood and Satya Nadella expected these numbers with their lack of hardware promotions and price rises.

 

[TheThreadsThatBindUs]

It's a complete disaster.

Imagine spending $80bln on COD only to fucking tank its sales because you make the inept dumbass decision to put it on GamePass day one.

 

[SmokSmog]

Wow. They better hope COD BO7's launch beats COD BO6's launch when it's released next quarter or they will be putting up an embarrassing decline number

 

[PeteBull]

I'm surprised people don't realise that hardware sales falling is a good thing for Xbox's profit margins. And I'm sure Amy Hood and Satya Nadella expected these numbers with their lack of hardware promotions and price rises.

The fewer xbox units microsoft sells the worst profitability gamepass gets, hence recent price hikes, in hypothetical scenario/alternative universe where xbox series sold by now over 100m units price of gamepass wouldnt be raised like it did coz simply it would be very profitable with much more subs.

 

[Ellis]

I can see them cutting their losses and cancelling Fable before Christmas. That'll be the next big news for Xbox, and further confirm the absolute shitstorm the Xbox devision is in.

 

[Astray]

HW declines are a massive problem for Xbox console users, because the more the userbase shrinks, the more Microsoft will have to start looking at said userbase as a problem instead of an asset.

Like they have to keep servers on for a userbase that is shrinking in both user count and user spend. Something's got to give!

 

[DeltaPolarBear]

HW declines are a massive problem for Xbox console users, because the more the userbase shrinks, the more Microsoft will have to start looking at said userbase as a problem instead of an asset.

Like they have to keep servers on for a userbase that is shrinking in both user count and user spend. Something's got to give!

Assuming most Microsoft 1st party titles are Play Anywhere, at least the PC servers would stay on a little longer. But online games all die one day, it just depends on how much you can salvage offline.

 

[Hector Hall]

HW declines are a massive problem for Xbox console users, because the more the userbase shrinks, the more Microsoft will have to start looking at said userbase as a problem instead of an asset.

Like they have to keep servers on for a userbase that is shrinking in both user count and user spend. Something's got to give!

They won't.
All this Xbox Magnus is only a way to put a golden bridge to PC gaming, for a hefty price that is, for current Xbox users. Once there they will have some emulator for digital version of past games, migrate their username to renamed Games for Windows, Xbox PC, and a UI blade on Windows, and that will be it.
There will be no Xbox version of new games, you will just run the PC version but if you buy it on Xbox PC store it will have banner or something, there will be no dedicated servers, and MS will lower their costs tremendously not having to subsidize hardware, not having to make deals with publishers so they keep supporting a sinking ship, and so on. And that way they support Windows in the gaming scene, starting to lose some ground against SteamOS.

Now, if those users on that Windows machine they will buy in Steam, or buy keys in dubious sites, or install emulators, or just plain pirate games, IDK what kind of income will remain for MS.

I am sure they could prepare a version of OS specially to avoid piracy and unverified keys, but in that case most PC users will remain in PC, and you have a 1200 bucks consolized PC with less features to sell to your shrinking 30m worldwide user base.

 

[Ar¢tos]

Imagine working for Xbox right now... The fear of getting an email or a tap on the shoulder calling you to HR at any given second.
Dreadful.
And when Nutella decides he had enough it will cease to exist instantly.

 

[MisterXDTV]

Big games will be...

Call of Duty (first current-gen only title)
Forza Horizon 6
Halo CE (PlayStation debut)

I see Gears E-Day and Fable slipping to 2027

Call of Duty is cross-gen again this year

 

[AJUMP23]

1% growth, no bonus for Phil I bet.

 

[RetroGamingUK]

Call of Duty is cross-gen again this year

 

[MisterXDTV]

Oh you mean the next one after this one

 

[RetroGamingUK]

Oh you mean the next one after this one

Wouldn't surprise me, no wonder people are jumping to Battlefield.

 

[NickFire]

Huh?

Shouldn't actual sales be up too? They've been selling on PS so I have to believe sales have gone up.

 

[ShadowkillXNA]

You guys are really obsessed with MSFT financials.

You are really obsessed with downplaying and muting discussion regarding MSFT financials.

 

[Baemono]

I'm surprised people don't realise that hardware sales falling is a good thing for Xbox's profit margins.

They don't realise that because that's not really true. Hardware is counted separately from Xbox "content and services". The 30% profit margin is about games, game pass and microtransactions mostly. We saw during the ABK trial how they do accounting.

 

[ShadowkillXNA]

It doesn't bother me at all; I just find it amusing. Stay fascinated.

It's ok to let it out, we here at neogaf care for you like you're family.
Just like your favorite trillion $$$ company does as well.

 

[RetroGamingUK]

 

[mckmas8808]

I'm surprised people don't realise that hardware sales falling is a good thing for Xbox's profit margins. And I'm sure Amy Hood and Satya Nadella expected these numbers with their lack of hardware promotions and price rises.

Why does that matter? You may have a good point, but I feel like I'm missing it.

 

[CuteFaceJay]

Much like how the fake inflation numbers are given out by FED and governments this 1% is prolly faked because outside of GAF no one talking about xbox.

 

[Ar¢tos]

Devkits for the next Xbox...
So, PC?

 

[Woopah]

So hardware losses are killing revenue growth

Yes. Lower hardware and first party revenue is offsetting growth in Gamepass and Xbox third party sales.

It's actually worse than you think.
The 30% Microsoft mandate is based on profits, not revenue.

That's profit margin, not profit growth.

So expecting decline on hardware and C & S, during BO7 launch.
Not sure how much further hardware can decline though.

I reckon they think Battlefield is going to take some of their customers this year.

GamePass price increase must have been used to artificially bump the numbers.

It will bump the numbers but it isn't "artificial"

Last I heard Microsoft is worth 4 trillion, which means Microsoft could give a $5000 check to every man, woman, and child in the United States, and still be worth over 2 trillion.

Their value is not the same as cash in the bank.

Truth is Ms Gaming has a plethora of income from other platforms. Games on Playstation, games on PC, Minecraft (massive on Switch), GP on PC, the income of ABK and Zenimax on other platforms, mobile with King...yet they are unable to put a profit number next to income each quarter. 30% my ass, gaming isolated is still in the red.

The actual "Xbox only" numbers in there must be pretty terrible. That's why Hood and Nadella have decided to sacrifice the deficitary side of the equation.

Microsoft doesn't put profit numbers next to any division. Even the really profitable divisions don't share numbers.

 

[mayham2199]

Huh?

Shouldn't actual sales be up too? They've been selling on PS so I have to believe sales have gone up.

That's the crazy part it doesn't seem to be helping much. It's a quick fix for some quick revenue but it's not a long term solution. People seem to think that going 3rd party would save Xbox but it's not that simple. Even large 3rd party publishers are struggling in gaming right now. Being a Platform holder is actually the safest position to be in right now.

 

[Ebrietas]

That's the crazy part it doesn't seem to be helping much. It's a quick fix for some quick revenue but it's not a long term solution. People seem to think that going 3rd party would save Xbox but it's not that simple. Even large 3rd party publishers are struggling in gaming right now. Being a Platform holder is actually the safest position to be in right now.

I continue to be amazed that people don't get this. That MS going third party isn't some 4d chess move. It means they lost, big time. Making games is expensive, risky business. And even when it pays off it's still not as lucrative and safe as just owning the platform and taking a 30% cut from everyone else.

 

[TheThreadsThatBindUs]

Huh?

Shouldn't actual sales be up too? They've been selling on PS so I have to believe sales have gone up.

First party game sales now include Activision and Bethesda games, whose revenue will dwarf MGS games. So any gain in PS sales of MGS games will be entirely eroded away by the loss of Xbox sales of Activision and Bethesda games from putting those games on GamePass.

 

[MayauMiao]

 

[mckmas8808]

Looks like it ends at 60,000 weekly signups. I'd be curious if it drops below 50k per week after the price increases.

 

[Woopah]

Much like how the fake inflation numbers are given out by FED and governments this 1% is prolly faked because outside of GAF no one talking about xbox.

A company's financial results aren't a measure of people talking about things. It's not "fake".

 

[Hector Hall]

1% growth, no bonus for Phil I bet.

It's - 2% in fact.

+1% is only services

 

[Techno_Inked]

??
It's easier to make a profit when you reduce costs. Each console you sold generated revenue, yes, but also manufacturing costs that exceeded that revenue.

It is easy to understand their strategie to increase profit margins. Minimize the items that generated losses (in this case, hardware).

Then, the 1% is good news in so far as it's more than they themselves predicted.

And this same quarter was very strong in terms of software revenue last year, and today one has matched or even surpassed it despite a 29% drop in hardware revenue.

It will be interesting to see their forecast for the next quarter with Call of Duty, several first-party releases, and the Christmas season.

You can spin it however you want but 1% revenue increase says nothing about how close or far that is towards their 30% profit margin goal. There's a reason why Xbox is notoriously bad at reporting profits. It's because their business is going down.

How is that worse?

Because revenue says nothing about profits, nor profit margins. Your revenue can be up 100% but still be making a loss.

That's profit margin, not profit growth.

You are correct, I misremembered. Yet the point still stands.

 

[poppabk]

Because revenue says nothing about profits, nor profit margins. Your revenue can be up 100% but still be making a loss.

Exactly - revenue can drop and at the same time your profit margin can increase. If they were looking for a 30% increase in revenue then 1% revenue increase is really bad. A 1% revenue increase when you just canned a bunch of employees means your profit margin almost definitely increased.

 

[Hector Hall]

You can spin it however you want but 1% revenue increase says nothing about how close or far that is towards their 30% profit margin goal. There's a reason why Xbox is notoriously bad at reporting profits. It's because their business is going down.


Because revenue says nothing about profits, nor profit margins. Your revenue can be up 100% but still be making a loss.


You are correct, I misremembered. Yet the point still stands.

Soft+hardware it's in fact - 2%.

 

[Zacfoldor]

If they cancel Fable it will be worse than anything so far that has happened to Microsoft.

If they cancel Fable they will never reach their goals. People who love them and have stuck by would wash their hands.

...and Seath the Scaleless betrayed his own and the Xboxes were no more...

They won't cancel fable, they will fake it forever if they have to.

 

[poppabk]

Soft+hardware it's in fact - 2%.

The 30% profit margin was aimed at the devs though I am pretty sure. Individually it sounded like as well.

 

[mayham2199]

If they cancel Fable it will be worse than anything so far that has happened to Microsoft.

If they cancel Fable they will never reach their goals. People who love them and have stuck by would wash their hands.

...and Seath the Scaleless betrayed his own and the Xboxes were no more...

They won't cancel fable, they will fake it forever if they have to.

Fable and Perfect Dark are the only games I'm really looking forward to from MS. One is already canceled I hope Fable makes it.

 

[Techno_Inked]

Exactly - revenue can drop and at the same time your profit margin can increase. If they were looking for a 30% increase in revenue then 1% revenue increase is really bad. A 1% revenue increase when you just canned a bunch of employees means your profit margin almost definitely increased.

That is an assumption. It's impossible if other expenditures have increased. If everything went well they would release profit info to ensure shareholders everything is going well.

 

[poppabk]

That is an assumption. It's impossible if other expenditures have increased. If everything went well they would release profit info to ensure shareholders everything is going well.

They rarely release profit numbers even for divisions that are making bank though. We are completely in the dark on whether they are even making a profit or a loss. Even when they release data it's 'accountability margin'. We might hear if they hit that 30% but I wouldn't bet on it.

 

[Woopah]

That is an assumption. It's impossible if other expenditures have increased. If everything went well they would release profit info to ensure shareholders everything is going well.

MS doesn't release profit numbers for any division. So even if Xbox is profitable we wouldn't know.