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Xbox hardware sales have taken another hit in Microsoft's Q4, while gaming content sales surged again, thanks to last year's acquisition of Activision-Blizzard.
Microsoft's earnings report revealed a 42% year-over-year decline in hardware revenue. This follows a significant 31% drop in the previous quarter, although there was a slight 3% increase in Q2 due to holiday discounts and promotions. Hardware sales were also down 7% in Q1 and have been steadily declining for several quarters.
Xbox isn't the only console maker experiencing a downturn in hardware sales. According to Circana's recent report, Xbox, Sony, and Nintendo all saw "double-digit percentage declines" in May 2024, with the Switch experiencing the most significant drop. This trend reflects the fact that all three consoles are in the latter stages of their life cycles and aligns with typical industry patterns. Xbox has confirmed that a "next-gen" console is in development and plans to share more information around the holiday season.
Despite the dip in hardware sales, gaming revenue overall is thriving, setting quarterly records. This growth is primarily due to the acquisition of Activision-Blizzard, which wasn't generating revenue for Microsoft last year. Gaming revenue increased by 44% year-over-year, with 48 points of net impact from the acquisition, indicating that Xbox's other business areas aren't performing as well as last year. Xbox content and services revenue fared better, rising 61% year-over-year, with 58 points of net impact from the acquisition.
Microsoft's More Personal Computing division, which includes Xbox and other segments like Windows, generated $15.9 billion in revenue, up 14% year-over-year. Microsoft will address these figures in its Q4 earnings call, taking questions from investors and analysts.
Source: https://www.ign.com/articles/xbox-h...-acquisition-continues-to-boost-content-sales
Microsoft's earnings report revealed a 42% year-over-year decline in hardware revenue. This follows a significant 31% drop in the previous quarter, although there was a slight 3% increase in Q2 due to holiday discounts and promotions. Hardware sales were also down 7% in Q1 and have been steadily declining for several quarters.
Xbox isn't the only console maker experiencing a downturn in hardware sales. According to Circana's recent report, Xbox, Sony, and Nintendo all saw "double-digit percentage declines" in May 2024, with the Switch experiencing the most significant drop. This trend reflects the fact that all three consoles are in the latter stages of their life cycles and aligns with typical industry patterns. Xbox has confirmed that a "next-gen" console is in development and plans to share more information around the holiday season.
Despite the dip in hardware sales, gaming revenue overall is thriving, setting quarterly records. This growth is primarily due to the acquisition of Activision-Blizzard, which wasn't generating revenue for Microsoft last year. Gaming revenue increased by 44% year-over-year, with 48 points of net impact from the acquisition, indicating that Xbox's other business areas aren't performing as well as last year. Xbox content and services revenue fared better, rising 61% year-over-year, with 58 points of net impact from the acquisition.
Microsoft's More Personal Computing division, which includes Xbox and other segments like Windows, generated $15.9 billion in revenue, up 14% year-over-year. Microsoft will address these figures in its Q4 earnings call, taking questions from investors and analysts.
Source: https://www.ign.com/articles/xbox-h...-acquisition-continues-to-boost-content-sales
