I don't really think they should stick with Xbox either, it has never been really successful. Even the 360 was mainly an American console and that was the best MS has ever done with Xbox. The Bone is heading for a distant second place finish this gen and it's not going to be close worldwide or in the US.
It doesn't have to be first place or even a close second, it just has to make enough money to justify existing. The Xbox brand is still very popular, especially in the US and UK.
Windows Phone, on the other hand, was DOA from the start. All other OEMs have dropped out of making Windows Phones and even Nokia couldn't keep it up, which is why MS had to buy out their hardware division for Windows Phones to continue being made at all.