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Xbox hardware revenue down 42%, content and services up by 61% last quarter

Three

Gold Member
I think the quarter after next is gonna he very interesting because the baseline is going to include ABK revenue in full. No more paper increases in overall revenues like this. It's gonna be apples to apples and I don't think Spencer has it in him to be as good as Kotick was at this kind of game.
MS have a good way of playing with the numbers to show it as growth. Quarter after next will be in Gamepass price hike territory (October) and COD release. Again showing growth for content and services vs last year. This quarter ending (June 30) they had a price hike at the end of last year around that time so content and services saw bigger growth this year too.
 

Jaybe

Member
MS have a good way of playing with the numbers to show it as growth. Quarter after next will be in Gamepass price hike territory (October) and COD release. Again showing growth for content and services vs last year. This quarter ending (June 30) they had a price hike at the end of last year around that time so content and services saw bigger growth this year too.

Feels a bit like since the acquisition went through, MS have been sandbagging the rest of the year knowing the ABK growth would cover them and it would give them a baseline they can more easily beat this new fiscal year with GP price hike/tier changes, finally ABK’s catalog to GP, and porting their big titles to PlayStation.
 

splattered

Member
While its a big number didn't we just hear a couple of months ago PS hardware was down like 30%?

The rush isn't there anymore

Maybe I am thinking something else about that 30% number

Regardless imagine at Castle Green they see these numbers and think "Oh lets release the same consoles but lets make them white, that will fix sales"

Red Wine Ugh GIF by Married At First Sight

Ok you're making me wanna go watch his video... sigh.

Even with things in their current state I am still 100% willing to give Xbox one last chance at a killer console.

I habe faith that the software is now finally coming at a steady cadence, I just have to be able to believe they will fully support the next console through its generation.
 

reinking

Gold Member
Ok you're making me wanna go watch his video... sigh.

Even with things in their current state I am still 100% willing to give Xbox one last chance at a killer console.

I habe faith that the software is now finally coming at a steady cadence, I just have to be able to believe they will fully support the next console through its generation.

…but they already have a killer console.

If You Say So Reaction GIF
 

REDRZA MWS

Member
They're going somewhere alright. To Third Party Land.
Right after they change their entire gaming division name to Activision-Blizzard because that's, quite literally, the only thing keeping them afloat.

Hilarious you think there's going to be a next Xbox when their current one has seen a 30% drop and a 40% drop in the SAME fiscal year. Xbox hardware is dead and buried. Better come to terms with that now and save some grief later.
And make a killing on EVERY plarform. They are a multi billion dollar company. They’ve annoyed some great games coming, made some solid acquisitions, have a pc user bad alone that shots on Sony or Nintendo. Where in any of MS’s actions showed you they won’t make the next Xbox. Let your fanboy shit go for a minute and use common sense.
 
And make a killing on EVERY plarform. They are a multi billion dollar company. They’ve annoyed some great games coming, made some solid acquisitions, have a pc user bad alone that shots on Sony or Nintendo. Where in any of MS’s actions showed you they won’t make the next Xbox. Let your fanboy shit go for a minute and use common sense.
Nothing you said have anything to do with needing Xbox hardware carrying its own weight. Nothing you described as a success need Xbox hardware to be there, so there is no reason to make the next Xbox if it plays no part in any profitability.

Remember, hardware is not profitable by itself. So if MS gaming is doing just fine while Xbox hardware is making a mess of itself, that means Xbox hardware is no longer justifying its existence.
 
Y’all focusing on the wrong shit. Xbox developing a new CoD that releases this fall that will make up 500 trillion new users on Xbox.

you-made-thisi-made-this.jpg


This picture is now true!
You are SUPPOSE to make console seller games, exclusive to the console.
As it is, no one would buy an Xbox machine to play it. Worse, the price increase of Gamepass means it is cheaper to just pay 70 dollars to own CoD, so it can't even help Gamepass numbers.
 

splattered

Member
MS knew these numbers were going to be bad its why people have been talking more about the next xbox, which its always whats next for them

I wont watch him but have been told Mr Green himself Colt Eastwood is pretty spot on with his latest video on what the next Xbox likely looks like

Watched the video, i think it's pretty much what everyone expects out of the next console(s).

What would be funny to see is... PSVR2 support on the machine via Windows. Or would Sony block it?

At this point i think for their dying hardware sales are sales...
 

IDKFA

I am Become Bilbo Baggins
I seriously doubt it would be a console. What they also focused on in their reporting was the focus on high margin premium products, which will probably extend to the xbox brand with the release of a high margin Xbox that is in reality a gaming PC that runs multiple marketplaces. The largest technical leap is made more easily by selling a gaming PC rather than a console, which has always been the case (same with Arcade vs console), but how big the market is for that device is yet to be seen.

Definitely doesn't sound like a traditional console.

Very odd wording for what essentially be a branded PC.

That also sounds like it'll be more expensive than a console, but not as functional as a PC.

Sounds like a huge flop in the making.
 
Where are you gathering estimates on shipments rather than units sold or are you simply creating a buffer? I ask because the historic data that you're using is mixing sales and shipments.
Based on hardware revenue in Microsoft's quarterly reports (which is revenue from shipments) and the first 2 years were leaked in the legal case against Microsoft's acquisition of Activision Blizzard.
 
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Topher

Identifies as young
I have said for awhile now the next Xbox approach wont be a traditional console to go head to head against the next Playstation, that method isn't working

watching the colt eastwood video that you said you heard was on the money. That means the next Xbox will indeed be a PC/Xbox hybrid if true. Believe we talked about that possibly being the case months ago.
 

Fess

Member
watching the colt eastwood video that you said you heard was on the money. That means the next Xbox will indeed be a PC/Xbox hybrid if true. Believe we talked about that possibly being the case months ago.
Watched the video. That is a brilliant plan, in theory. But going with ARM is going to mess things up for anyone thinking it’s also a regular PC. Everything x86 will be emulated. And as usual with emulation there will be compatibility issues and performance problems that needs extra patching, or special versions for multiplats.

Watch them stumble on the finish line because of that. Going with unusual hardware is never a good idea, especially not when you’re a small player, which they still are on the platform side.

But I would still get one.
 
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Topher

Identifies as young
Watched the video. That is a brilliant plan, in theory. But going with ARM is going to mess things up for anyone thinking it’s also a regular PC. Everything x86 will be emulated. And as usual with emulation there will be compatibility issues and performance problems that needs extra patching, or special versions for multiplats.

Watch them stumble on the finish line because of that. Going with unusual hardware is never a good idea, especially not when you’re a small player, which they still are on the platform side.

But I would still get one.

Yeah...going with ARM is the part I'm not really getting. Why do that?
 

Fess

Member
Yeah...going with ARM is the part I'm not really getting. Why do that?
Probably power saving or some other crap, and compatibility to their handheld.

Would you buy a regular gaming PC with ARM?
No? Me neither.

I’m no nostradamus but I’ve been following this industry for over 40 years now and seen platforms come and go. Historically this is one of those scenarios where a platform fails. Being unique almost never works out well. They’ll just end up missing multiplat versions and will have buggy special ports made by other teams with late or no patches and legacy PC games will run badly and mods won’t work. It’s like combining the bad things with Saturn, PS3, Mac, Steam Deck into a jack of all trades device that does a lot but nothing really well. Except maybe Xbox backwards compatibility.
 
Good point! To be fair few people outside of nationalistic flag pumping and rabid fans/influencers were cheering the idea of spending over $70 Billions to buy revenue, lie through their teeth, and still destroy value…

That is true. The problem is, a lot of the games media were among the ones cheering the acquisition through. Them, the fanatics, and 'Murica, F*ck Yeah!" group were the loudest by far even if they were a small fraction of total people talking about or following the deal.

Incidentally, seems MS really needed it to go through just to salvage their gaming division. Otherwise I think we'd be hearing of Xbox getting shut down by the end of this year.

The only benefit is that it's difficult to do worse than Hellblade.

Pentiment probably performed worst than Hellblade II in player metrics & sales, so Phil's already accomplished that!

They could do it but that doesn’t seem to be their plan, we would’ve had some rumours like the Pro specs by now and Mr Talkytalk Spencer would’ve said something. All they say now is that they’re working on the next Xbox and that it’ll be powerful, but their actions say that a Xbox console isn’t needed, don’t worry just use a Firestick and so on.

I think some people are misconstruing Sarah's words. When they say "generational leap" or whatever their exact words were, they aren't talking "power" in the traditional console sense. I mean, yes, the next Xbox hardware will probably aim within the ballpark of PS6 performance-wise, for the high-end model, but they just can't compete with Sony and Nintendo in the mass-market gaming space anymore.

So to me, they must be aiming for a "leap" in terms of blurring lines between a console and PC. That's why they've been talking about Steam on Xbox here and there. Most likely, the next Xbox systems are going to run whitelisted Windows apps through their storefront, and they'll add extended functionality to Xbox OS for Windows features through some abstraction layer to run programs like Steam, accessed through some Game Pass tier.

It'll be like Microsoft's version of Wine, but for Xbox OS to run Windows programs. An evolution of the Dev Mode on the current systems, but at the "retail" level. And they'd tie access to other gaming storefronts like Steam to Game Pass to earn money off it being on the console, because chances are B2P sales in the Xbox Store will nosedive when other things like Steam are accessible on the same device (and Valve will have no interest in a revenue sharing model with Microsoft).

That should probably allow them to do a PS6-level "high-end" model at like $699 (assuming PS6 top SKU is $499...it'll probably be more); expensive enough to have good profit margin, cheap enough to still be competitive with mid-and-high end gaming PCs and mini-PCs/NUCs. Plus they'd also likely have some modularity like upgradable DRAM and low-profile dGPUs.

How that'd work with OEMs, most likely is MS makes their version and they license out Xbox OS & the frontend to OEMs who build machines based on the common spec (but maybe offer additional non-gaming stuff like extra USB ports, extra ethernet ports, Thunderbolt ports etc.), and maybe can upclock the CPU, GPU, and RAM if they wish (like how 3P Nvidia & AMD GPUs tend to). Maybe MS helps in parts of manufacturing and the companies share the same wafers (MS puts in the orders for OEM chips for example).

It's kind of the only path Xbox has left for gaming hardware. Even assuming they do a handheld and OEMs do hardware variants of their own (tablets, laptops etc.), this type of Xbox hardware won't be competing with Sony & Nintendo in volume. But they might be able to do between 5 - 7 million annually, maybe a bit more depending on other factors. Which would at least make Xbox hardware respectable again in mass market performance.
 

DavJay

Member
A little off topic but is this a good deal?


Alienware - Aurora R16 Desktop - 14th Gen Intel Core i9 14900KF - 32GB Memory - NVIDIA GeForce RTX 4080 SUPER - 2TB SSD - Black

Open Box Excellent condition for $2199 before tax

Just did an impulse purchase rebuke browsing
 

BlackTron

Member
A little off topic but is this a good deal?


Alienware - Aurora R16 Desktop - 14th Gen Intel Core i9 14900KF - 32GB Memory - NVIDIA GeForce RTX 4080 SUPER - 2TB SSD - Black

Open Box Excellent condition for $2199 before tax

Just did an impulse purchase rebuke browsing

It's not the worst price for those parts but I'd have gotten a better deal with an AMD processor.

Edit: I also would have gotten an even better deal putting it together myself instead of an Alienware but that's whatever. If you just want a strong gaming PC you could have done worse. Just the hot, overpriced Intel chip is meh to me. Make sure Alienware didn't skimp on cooling FFS.
 
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Mr Moose

Member

Shane89

Member
“gaming revenue at Microsoft is up 44 percent overall, helped again by the additional Activision Blizzard revenue.”

So Xbox grew 6%

There, I translated it for you.
 

Taur007

Member
They're going somewhere alright. To Third Party Land.
Right after they change their entire gaming division name to Activision-Blizzard because that's, quite literally, the only thing keeping them afloat.

Hilarious you think there's going to be a next Xbox when their current one has seen a 30% drop and a 40% drop in the SAME fiscal year. Xbox hardware is dead and buried. Better come to terms with that now and save some grief later.
buddy relax, there's already a nextbox coming so all of this hoopla means nothing until it's actually set in stone, its actually more hilarious you think there won't be
 

Taur007

Member
LOL yes because somehow Nintendo doesn't exist whenever these analogies need to be made

Never mind that Xbox already doesn't exist outside of US and UK and so far Sony hasn't needed to be put in check
no one goes into a store thinking PS vs NIN, nintendo consoles were always secondary machines.
 

nick776

Member
The cylinder design we saw from leaked documents didn't have any performance improvements. It was a different shape to the plastic - like the PS5 slim. I seem to remember it had slightly faster wifi and a more recent bluetooth codec, which the new disc-less X didn't get. But even if it had, no one is going to swap out their existing Series X for slightly faster wifi.

Series X Pro was a decision they would have needed to make 2+ years ago to work on the designs, and would have required investment. They clearly aren't in a position to do that with sales being terrible, and it probably wouldn't have mattered anyone. The real Series X Pro is a gaming PC.

If people fundamentally don't want their console, there's nothing they can do to spice it up. They can only come out with new software to try and juice the existing hardware, or come out with new hardware, which seems like a bad idea given the trajectory of the Series consoles.

They're in a Dreamcast style death spiral. It's a slow moving train wreck that we've all been watching for the last 9 months. It's probably got at least another 6 to go. Q1, when we see the results of putting COD on Game Pass will be the real brass tax moment. Starfield failed hard. If COD fails hard too, they won't have a card left to play next year.
I agree, it really reminds me of the death of Dreamcast with Xbox hardware in the past year. I think Starfield was a big loss moment for them. When the game didn't achieve over 90 on Metacritic they took a big hit. Sales have tanked, but I think the true reasons for it tanking are entirely the result of bad decisions on Microsoft's part (ex.--that Redfall was released AT ALL is a testament to how little Microsoft cares about things I think). Also, who in their right mind pays $600.00 for a series X with paint splattered all over it for an extra TB of SSD space? That is an exceedingly dumb decision on Microsoft's part to price the device in such a manner. After decisions like that, I wonder if there are people within Microsoft who genuinely wonder why sales are so abysmal?
 


MS´s shit around 10:00-30:00

20B dollars a quarter for A.I. investment and the cost will go UP. yisus fucking christ.

bruh..If A.I. stagnates/doesn't reach expectations in the next 5-10 years... it's going to be ugly, ugly, ugly.
 

ZehDon

Member
MS have a good way of playing with the numbers to show it as growth. Quarter after next will be in Gamepass price hike territory (October) and COD release. Again showing growth for content and services vs last year. This quarter ending (June 30) they had a price hike at the end of last year around that time so content and services saw bigger growth this year too.
Yep, it's why they report mostly revenue for their individual segments - because its easier to present growth to the investors with that metric - with reporting overall profit for the corporation's divisions. It allows them to bundle in the losses from Division A's segments 1 and 3 with the large profits from segment 2 to show overall profitability for Division A. With that said, given the eye-watering expenditure for their ABK acquisition, I'm curious if investors will hold their feet to the fire on that one. Using ABK to prop up Xbox will only work for so long.
 

PeteBull

Member
A little off topic but is this a good deal?


Alienware - Aurora R16 Desktop - 14th Gen Intel Core i9 14900KF - 32GB Memory - NVIDIA GeForce RTX 4080 SUPER - 2TB SSD - Black

Open Box Excellent condition for $2199 before tax

Just did an impulse purchase rebuke browsing
Dont,bro, 13th and 14th gen intel cpu's have humongous failure late, its so common even intel itself admitted to it in official statement.
edit: there https://www.neogaf.com/threads/ther...h-gen-cpus-—-any-damage-is-permanent.1673204/
 
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rm082e

Member
I agree, it really reminds me of the death of Dreamcast with Xbox hardware in the past year. I think Starfield was a big loss moment for them. When the game didn't achieve over 90 on Metacritic they took a big hit. Sales have tanked, but I think the true reasons for it tanking are entirely the result of bad decisions on Microsoft's part (ex.--that Redfall was released AT ALL is a testament to how little Microsoft cares about things I think). Also, who in their right mind pays $600.00 for a series X with paint splattered all over it for an extra TB of SSD space? That is an exceedingly dumb decision on Microsoft's part to price the device in such a manner. After decisions like that, I wonder if there are people within Microsoft who genuinely wonder why sales are so abysmal?

Phil Spencer has been unusually candid in interviews for a corporate executive. He was out there taking responsibility for Redfall when it launched saying it was his fault that the game launched to such poor reviews. It kind of makes me sad that he gets so much shit, but I get that people need to direct their anger at someone and he's the recognizable face at the top.

It seems like he's made each decision based on what was "on paper" a sound business decision. I'm sure each acquisition they made was based on the company (like Bethesda) having really solid financials. I can imagine their idea was if you buy enough companies that all have solid financials, the sum of all that blank ink would help turn the tide for the Xbox division.

The problem seems to be the meta-game that's happening around them. It sure looks like these studios are building a name for themselves with some good games, then cashing in by selling to Microsoft, then the talent either leaves or just checks out and doesn't deliver on the next one. They wind up losing their creative spark and their output winds up being mediocre fluff that no one wants. Combine that with the Game Pass business model and escalating costs, and I just don't see how this accomplishes the goal of helping to rebuild the Xbox brand.

I've been wondering lately if Phil realized the eventual death of the Xbox brand was inevitable a few years ago. He's proven to be well aware and clued in when we hear him speak in interviews. I can imagine buying up Activision set him up with a future as the head of gaming division even if/when Microsoft gives up on Xbox.
 
I believe folks when they say Microsoft has a hardware piece in mind that's more akin to just a PC, but kind of getting out of Xbox.

My question would be how much of a success it'll be, or what they expect it to be. If it's at a premium price(and HeisenbergFX4 HeisenbergFX4 has said it's a bit of a sticker shock), I wonder how the market would react.

I remember back in yesteryear when people balked at the $599 PS3 tag. I figure the PS5 Pro is gonna come in at that; still pricey, but not in the realm of what this rumored device will be.

I'd say anything over $800 is going to be literally niche only, which I guess Microsoft will be okay with as it locks into the ecosystem.


But regular Xbox hardware right now is just dead.
 
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DryvBy

Gold Member
Somehow people think this proves consoles aren't worth it for the long run, ignoring this is just a Microsoft problem. Hardware sales for Nintendo and Sony are fine. I bet Sega could come back and have better hardware sales yoy
 

Astray

Member
His whole twitter page is a huge trainwreck.

It reads like exactly how you'd expect a for-hire social media account to read.
Ngl I always love going to his replies whenever bad Xbox news come out. There's an insanity in his rants that only he can provide out of any of the fanboys for any ecosystem.

In this case the Twitter For You algo recommended it lol.

Phil Spencer has been unusually candid in interviews for a corporate executive. He was out there taking responsibility for Redfall when it launched saying it was his fault that the game launched to such poor reviews. It kind of makes me sad that he gets so much shit, but I get that people need to direct their anger at someone and he's the recognizable face at the top.

It seems like he's made each decision based on what was "on paper" a sound business decision. I'm sure each acquisition they made was based on the company (like Bethesda) having really solid financials. I can imagine their idea was if you buy enough companies that all have solid financials, the sum of all that blank ink would help turn the tide for the Xbox division.

The problem seems to be the meta-game that's happening around them. It sure looks like these studios are building a name for themselves with some good games, then cashing in by selling to Microsoft, then the talent either leaves or just checks out and doesn't deliver on the next one. They wind up losing their creative spark and their output winds up being mediocre fluff that no one wants. Combine that with the Game Pass business model and escalating costs, and I just don't see how this accomplishes the goal of helping to rebuild the Xbox brand.

I've been wondering lately if Phil realized the eventual death of the Xbox brand was inevitable a few years ago. He's proven to be well aware and clued in when we hear him speak in interviews. I can imagine buying up Activision set him up with a future as the head of gaming division even if/when Microsoft gives up on Xbox.
He has been running this shitshow for more than a decade now, he owns all the messes, including the ones he pretends are not.

He's probably the biggest liar in the space, I have no clue why you think of him as candid.
 

rm082e

Member
Ngl I always love going to his replies whenever bad Xbox news come out. There's an insanity in his rants that only he can provide out of any of the fanboys for any ecosystem.

In this case the Twitter For You algo recommended it lol.


He has been running this shitshow for more than a decade now, he owns all the messes, including the ones he pretends are not.

He's probably the biggest liar in the space, I have no clue why you think of him as candid.

His comments on the Kinda Funny podcast right after Redfall released. He said he was to blame for not making sure it was up to the level of quality they expected. He also acknowledged there was no way Starfield was going to turn the tide for them before it released. He didn't try to do some egotistical spinning on either of those from the comments I saw. If he had some ego shit elsewhere, I just haven't seen it.

I guess I would also ask what makes him "the biggest liar in the space"? I've probably missed the details, but what specifically did he lie about?

I'm not saying he's not responsible. Clearly he is as the guy at the top of the organization so he is ultimately responsible. I'm saying as the guy who's responsible, he seems to have acknowledged the facts and accepted responsibility for the state of the business, rather than trying to blame the players like we've seen other VG execs do in the past ("arrogant Sony" during the PS3 days, Don Mattrick during the XO roll out, John Riccitiello, etc.)

Let's say MS fired Phil today and brought in someone with real creative vision - Then what? What would that person need to do to turn Xbox around? They'd need to make changes to the existing business that are so massive, I doubt they could be done. If Nadella isn't in a position to allow that, then replacing Phil with the best person in the world wouldn't make any difference.

Overall, I think what Phil said over a year ago is probably accurate - they lost the single most important generation (PS4/XO) because that's when everyone started building their digital libraries. Because of that, it's much harder to get players to give up on an ecosystem they've invested money into that they can't get something back out (i.e. no used physical media they can sell off). They lost that generation 2:1. It seems like that's an unrecoverable blow.
 
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