850°

Microsoft's Earnings Release FY14 Q4

Computing and Gaming Hardware revenue increased $3.2 billion or 49%, primarily due to higher revenue from the Xbox Platform and Surface. Xbox Platform revenue increased $1.7 billion or 34%, due mainly to sales of Xbox One, which was released in November 2013, offset in part by a decrease in sales of Xbox 360. We sold 11.7 million Xbox consoles during fiscal year 2014 compared with 9.8 million Xbox consoles during fiscal year 2013. Surface revenue increased $1.3 billion or 157%, due mainly to a higher number of devices and accessories sold.

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microsoft.com
MightyNoX3549d ago

It's almost like I, and so many others, have been saying this for ages.

Hopefully it'll be a wake up call to some deluded people around here.

iamnsuperman3549d ago (Edited 3549d ago )

Launching a console does come with a lot of baggage (in particular cost) so the difference isn't unusal (expect maybe the size). What this does unofficially confirm is Microsoft really won't go with a price cut this early.

BiggerBoss3549d ago (Edited 3549d ago )

Yeah I agree that it's expected to lose money during the launch of new hardware, but dang. That much money could last me over 100 lifetimes.-.

Didn't Sony make profit off Playstation last fiscal year? Correct me if I'm wrong

@devwan. Ahhh that's right. Thanks+

Wizard_King3549d ago Show
devwan3549d ago

@superman The majority of those costs is r&d. xbox one r&d costs are included in fy 13-14 results? Are you sure?

@BiggerBoss Last quarter, not last year.

amiga-man3549d ago (Edited 3549d ago )

Hardly the sort of news investors will want to hear, there has been plenty of talk of people wanting MS to sell their xbox division, although I don't think that will happen it only adds more pressure on the xbox.

Why o why3549d ago (Edited 3549d ago )

. . .but Sony . . . . .

Ok . . . Nobody has said it yet but I'm well surprised Sony haven't come up yet.

I like the point iamnsuperman made below about ms not acquiring deep pockets by making huge losses. It's true. .

Personally I hope they stay in the game and believe they will. Not all competition is good but anyone who thinks ms didn't wake Sony up is a little naive. Sometimes bad competition can be good too.

pinkcrocodile753549d ago

I'm not in the least bit surprised by the loss at this point in the Xbox One cycles, I'd expect a similar story from both Sony and Ninitendo too

Can we have a copy of the financial reports from both Sony AND Nintendo for a little comparrison.

I'd like to see how the same period on the Wii U and PS4 cycle affected finances, NOT SALES mind, just the company yearly finance report.

kneon3549d ago

@Why o why

It wouldn't change things much if they sold off xbox, it would just change hands, it wouldn't go away. Companies like Google, apple and amazon are looking to get into this market.

ZodTheRipper3549d ago

Microsoft simply sucks at making hardware, no wonder they are focusing on the cloud so much. I completely agree with Wizard_King, I'd rather see another company take Microsoft's spot in the console sector.

UltraNova3549d ago

@ Above

Who Activision? EA? Amazon wont bite, Apple is out of the question...who could buy the Xbox division and be less 'evil' than MS? Tough question I know...

OT: 400 million is a drop in the ocean for MS, literally. Yes the shareholders don't like this but selling their gaming division is admitting defeat to Sony and we all know how much winning means to our American friends...

This loss is probably attributed to the R&D for Kinect 2 as the actual console is selling ok (when compared to the 360 in a similar time frame).

Xbox is going nowhere and we should all be grateful for this. Imagine letting Sony and Nintendo run wild! No thanks!

Double Toasted3549d ago (Edited 3549d ago )

Lol I believe MS will be fine. I can't say the same for their competition though.

sonarus3549d ago (Edited 3549d ago )

This news is almost irrelevant to gamers however, it his HIGHLY relevant to microsoft investors. The fact that the Xbox division has only accounted for about 1.5 % of Microsofts gross profit 2014 fiscal yr just shows how irrelevant xbox division is to Microsoft's bottom line. This is why investors want the xbox division sold, spinoff or shut down. Xbox division simply isn't part of Microsofts core competencies and knowing this off course investors will be pissed if its accounting for such substantial losses.

However, new ceo has said microsoft will keep xbox because of its potential as a home entertainment device.

GTgamer3549d ago

To all people saying ohhhh this nothing to MS they can brush it off while being true No company likes losing Money it doesn't matter how much they have so stop being naive, you think MS wouldn't drop the xboxOne like a five Dollar hoe if it keeps losing money in the next few years ಠ_ಠ.

mixolydian_id3549d ago

It's still a small drop in the ocean for a multibillion dollar corporate business.

That cost was probably incurred by the considerable amount of changes that had to be introduced following E3 (2013).

They had already planned to blow a load of money on Console development. If they had released a year later, that money would've still been invested into console development.

I imagine a lot of the team ran up some serious overtime payment this past year to boot.

Not a loss, it's nice to know my future console has been thoroughly invested in.

guitarded773549d ago

@UltraNova

Just for the sake of conversation, Google could, and would be less evil. I know they never would, but they could, and they're pretty open to devs and innovation.

Also, a private investment group could. It happens from time to time. Private investors buy a company and turn it around... but typically they run it into the ground. A positive example is Fender Guitars. They were run to crap in the 80's, but then a group of their workers bought the company and brought the standards up to the highest in the companies history (arguably) along with the greatest profits. They in turn bought many other guitar companies... some of which they shuttered, which was bad :/

Samsara823549d ago

In answer to BiggerBoss ...I might be wrong but the last numbers given by sony were not for the year but were trimestrial so their developments costs were not included...I think they were included in their previous trimestrial report...Will have to wait for a whole year report from them to really compare anything

xer03549d ago

@BiggerBoss

Yes - Sony in comparison made a profit.

UltraNova3549d ago (Edited 3549d ago )

@guitarded77

Although I get why you used the Fender Guitars example an interested investment group would take into account the negativity the xbox brand carries with it at the moment and should probably consider their own inevitable scrutiny that they will get subjected to from the media and gamers alike in search of similar 'evil' characteristics to Microsoft.

What I'm saying for the lack of better English is that who ever wants to buy the xbox brand must have a pretty clean floor under that carpet of theirs if they want to 'revive' the brand and profit from it.

We gamers are a stubborn bunch we don't forget and we hardly forgive!

darthv723549d ago

@ultra... "We gamers are a stubborn bunch we don't forget and we hardly forgive!"

That seems to be more of a newer generational sentiment. At least from an older perspective, those of us who have been around much longer when gaming was first starting to develop, dont follow that sort of thinking.

The way you describe it is more along the lines of the entitled way of thinking. the "i'll be damned" crowd which has been getting worse and worse over the course of the last few generations.

gaffyh3549d ago

Wow, that's a lot, however I'm sure they expected some of this. I think it's worse because they haven't sold as much as they thought they would.

UnHoly_One3549d ago

@Wizard King

MS has been a cancer on gaming for 15 years?

Basically every feature you enjoy on your Playstation console is a direct response to MS doing it first.

Not saying that NONE of it would have happened without them, but some of it sure wouldn't have.

Do you think you'd have PS+ without MS? Would online gaming even be anything like what it is now without MS pushing it?

gaffyh3549d ago

@UnHoly_One - Not saying that MS is a cancer as I'm sure they sped up development particularly on the network side of things, but they weren't the first to do it at all. The Dreamcast already had an online infrastructure way before Xbox even existed, and even the PS2 had network support with games like SOCOM.

The only innovation that MS introduced to consoles was the ability to play games online with matchmaking, and HDDs on the box. And I am 100% certain that these features would eventually have been implemented on Playstation without MS being a competitor, but that the competition, sped up Sony's response.

I'd argue that MS actually copied Sony a lot more, almost their entire console strategy was copied off Sony's PS1 launch. And without Sony launching into the market, MS would never have even tried.

Magnes3549d ago

@wizard_king nice anti American sentiment and people call us bad I'm not a MS supporter but people like you make me reconsider. Man did I love my Dreamcast though.

Visiblemarc3549d ago

@UltraNova

400 million dollars is an enormous sum of money for *any* company.

There is a persistant myth in forums that large companies with deep pockets scoff at gigantic losses.

Not remotely true.

Companies get big by being good with money (and most being publicly traded have shareholders to answer to). Losing massive sums of it, is the road to failure and it almost always leads to huge policy shifts, staff changes and re-evaluations of strategies.

I recall a few years back people were talking about RIM's (Blackberry) warchest. Many thought those massive stores of cash made them invulnerable. In fact, it was no defense at all to an incredibly poor strategy.

I'm not directly comparing MS to RIM though (for countless reasons), in fact the massive Surface losses of recent times have probably made them even more sensitive. I expect increased caution.

thehitman3549d ago

Kinect was a 400 million dollar disaster is whats that saying.

rainslacker3549d ago

@darth

I have to disagree. At least partially. I do feel that the "Never forgive, never forget" mentality is a bit much, but gamers of all generations seem to be able to apply what happened with what could possibly happen and how it will affect them over the long term. I believe MS initial policies showed this to a great degree, as people not only were upset about the immediate result, but what it could mean if it were successful.

For my part, I have no reason to have to forgive MS. They were honest about it at least, and I never actually purchased anything to be upset about. I didn't approve, and I voiced my opinion, and didn't bother to pre-order the system. But from all this, I didn't forget either. What they did put a bad taste in my mouth for the future of gaming, and how I consume my gaming content. Having watched MS for well over 30 years, even before I really understood how seedy they are, none of it really surprises me in retrospect. It also means I have less faith in them to do the right thing in the future, because again, I don't forget.

They can certainly turn things around. But taking Sony's missteps last gen, which were nowhere near as bad, it took them several years before they started to be back in gamers good graces. I expect MS will be in a similar situation. If they do everything right this gen, they may not win this gen, but they may have a better chance of becoming "The winner" next gen.

Bigpappy3548d ago Show
Death3548d ago (Edited 3548d ago )

According to the Earnings Release, Microsoft made 893 million in gross margin on sales of 9.6 billion in 2014. This in contrast to 956 million gross margin on sales of 6.4 billion the year before. The Xbox didn't lose money, the division which includes Surface made 63 million less than the year before.

HanzoHattori3548d ago

Playstation didn't make money last year because of the purchase of the Gaikai streaming service, which is now called Playstation Now.

+ Show (25) more repliesLast reply 3548d ago
lelo3549d ago ShowReplies(12)
TheWackyMan3549d ago

What do you mean exactly? While 400 million dollars is a lot, it's Microsoft. I'm pretty sure they can handle a few losses. If it keeps happening, you should be a bit worried of course, but they are MUCH MUCH better off financially than Sony by a long shot.

Wizard_King3549d ago

MS has been bleeding large amounts of money for over a decade now, nothing and I mean NOTHING has been going right for them in the business world. Windows 8 is a flop, the surface tablets and Windows phones are loosing money in every market and the console division hasn't been in the black now for about 3 years. Not to mention that the games that MS had pinned on selling large amounts of consoles never eventuated to anything real.

Things are not looking good for MS and I see them doing a large amount of trimming the fat in the near future. Even Amazon confirmed a while back that they where not interested in buying MS's console division. I mean who buys something that lost the owner 400 million bucks last fiscal year, oh right NO ONE.

Dreamcast 2.0 before 2015 mark the page.

devwan3549d ago (Edited 3549d ago )

Xbox 360 hardware is profitable. Xbox Live Gold earns lots of money. Royalties on software sales generates plenty of income.

Now offset all those and end up in the red by $400m.

That's one hell of a large hole brought about by xbox one.

"They can handle a few losses" is such an ignorant cop-out.

marlinfan103549d ago (Edited 3549d ago )

@wizard

its obviously not good seeing a loss like this but where have you seen MS bleeding over the last decade? they continue to post profits year after year

marlinfan103549d ago

for the people disagreeing with my other comment

http://money.cnn.com/2013/1...

SniperControl3549d ago

@marlinfan10

Wizard is right.

They wrote off $900 mill a year ago because surface bombed bigtime, in fact it still is, current figure is around $1.2 bill.
Zune lost them half a billion a few years ago, Windows 8 has flopped big style, there Win phone division is struggling against giants Google and Apple.
The only division making true profit is there Office products.

FITgamer3549d ago

I love these types of comments. It's like people think Microsoft doesn't mind losing money.

SonyMontana3549d ago

MS is surviving on money from their glory days. Virtually every product they have on the market is a failure (Bing, Smartphones, tablets, the now dead Zune, Windows 8). They need a big hit in order to make a come back but the problem is they are out of touch with what people want these days. The launch of the Xbone serves as a shining example of just how out of touch MS is these days.

Kribwalker3549d ago Show
TheWackyMan3549d ago

@Kribwalker You're a god among men. Thank you.

n4rc3549d ago Show
Dehnus3549d ago

@Wizard_King
And there you go again with deciding what I should like. You probably never worked with a surface or a WIndows phone and can already decide for me. Than this Dreamcast 2 crap like it is a bad thing!

NEWSFLASH SONY FAN! It is one of the best liked consoles of all time with some of the most original games ever produced! Yes the Dreamcast is still loved by many, including having one of the most active homebrew scenes available.

What you call Evil I can also say for Sony. That said I do not want an Xbox one either, but stop dragging everything non Sony through the mudd just because it isn't your favourite choice.

marlinfan103549d ago (Edited 3549d ago )

yeah they've had a few failed products but that doesn't change the fact that they post profits quarter after quarter. every company has had bad products that end up costing money, thats why they don't put all their eggs in one basket. name any big company like MS that hasnt had products that cost them huge amounts of money. id bet you'd be hard to find one. saying they're a bleeding company with nothing going right is just silly when you look at their yearly profits. obviously somethings working.

Evilsnuggle3549d ago (Edited 3549d ago )

dev..wan@

360 didn 't make any money in fact 360 lost money . That is why the ex-CEO Nokia wanted to sale the X box brand. In fact X box has lost billions Microsoft would sell the X box brand if they could. Don't be surprised if Microsoft spins off the X box brand. If Microsoft spins of the X box brand then X box brand wouldn't have deep pockets like X box brand has now with huge advertisement and money hating games. I think it would do more harm than good . But it's the best way for Microsoft to make the best decision regarding X1.

Any way you cut it doesn't look good for X box brand. I don't think Microsoft will make another console. I really think Microsoft will make a set top that is a cloud services.

http://www.neowin.net/news/...

user3672723549d ago (Edited 3549d ago )

Bottom line is MS continue to make money even with a predicted loss on the console side as expected during the launch year. Can't say that about the competitors though. Imagine the tone in this thread if another company that is beloved here all of a sudden have a record quarter even with losses in launching a new hardware. MS will be fine and Halo 5 will still be released next year. That id what matters to us gamers.

+ Show (12) more repliesLast reply 3549d ago
Gazondaily3549d ago (Edited 3549d ago )

Doesn't launching a console always have high costs associated anyway? Whether or not this loss is 'reasonable' is another question entirely, but some of the other 'deluded' lot may jump to conclusions as they get over-excited and giddy over the news.

Anyway, as the chap above me has quite rightly said, MS can take this hit (natural or not). Others in the game may not be in a position to swallow these kind of losses (if they do suffer from them at all).

iamnsuperman3549d ago (Edited 3549d ago )

It depends how many losses they are willing to take. Microsoft has deep pockets but those deep pockets didn't materalise from huge losses. The problem for Microsoft isn't the Xbox brand. It's the electronically products as a whole. It has been estimated that Microsoft has lost a combined loss of 1.7 billion on the surface endeavour. That is a big loss. If Microsoft don't pull this around next year's those little discussions about how Microsoft should not be a manufacter might get louder.

That is the biggest threat to the Xbox. They may end up being lumped into a problem the Xbox could easily get out of.

@below If the Xbox brand doesn't bring return or small, insignificant, gains, it definitely will. The problem for the Xbox is Microsoft's other electronic endeavours are doing so poorly they may just scrap the whole thing entirely. The Xbox is a surprisingly small part of Microsoft of which sits low on the priority list

Gazondaily3549d ago

Yeah that's a good point. I don't see the Xbox getting lumped into the whole electronics product anyway because the attachment and goodwill associated with the Xbox brand is tremendous (especially compared to failures such as Surface etc).

If however, the Xbox division continues to see losses over the course of this year and next year, then yeah, that's when alarm bells should be ringing at MS HQ.

Menkyo3549d ago

@septic "good will" are you kidding ? What good will right now their the step child of gaming.

Gazondaily3549d ago

"@septic "good will" are you kidding ? What good will right now their the step child of gaming."

Are you seriously telling me that the Xbox brand has no appreciable goodwill vested in it??

Spotie3549d ago

@Septic: Within the gaming industry? Not really. A couple of fans, like yourself, have forgiven them. But most gamers have not, I think.

Seriously, look at how they manage to piss off everybody but the most devout fanboys. Sure, they may have changed things now, but people's memories don't just vanish.

Gazondaily3549d ago

@Spotie

I'm talking about Goodwill in terms of the Xbox brand as an asset. Not just about consumer perception (of which admittedly it forms one part of it).

"Within the gaming industry? Not really."

Obviously its within the gaming industry.

brew3549d ago

Yes , and they have more launches yet to come !

mixolydian_id3549d ago

It's an expensive business. At least they haven't been sued yet!

To be fair, they would've blown a lot of that anyway... even if the console was released a year later.

There would've been some costs incurred from introducing the 180's so eagerly voiced by the brats.

I still would've preferred the old vision for the Xbox.

If thats just the annual spenditure number, I'm glad to see they've put so much money into the device. Actually makes it a more valuable commodity. Probably explains they're thirst for updates and new feature sets.

the 3 x operating system must've been a entirely new build. The first of it's kind ever. They pretty much wrote the book on it... I wonder how long it'll be until we start seeing multiple operating system devices pop up all over the place?

BABY-JEDI3549d ago

MS have good will as they are now listening to the gaming community & they are now acting upon them.
I would say this is good will (regardless of all the mistakes)

Revolver_X_3549d ago

"at least they haven't been sued yet!"

Google is your friend kid.

http://www.escapistmagazine...

Theres always some knitwit tryna make a buck off of strawman claims.

MysticStrummer3549d ago

"At least they haven't been sued yet!"

Wow. Such delusion.

rainslacker3549d ago

400 million isn't a whole lot when you take into account R&D, but I don't know if this figure includes that cost, as it was likely written off the year prior.

This particular figure is also from all their devices division, but I wouldn't doubt a lot of it is for marketing and R&D and distribution of the X1.

It's not the end of the world for the X1 by a long shot though. We're talking about a product that has a 5-7 year shelf life, and if they can make that money back in that time, or better yet profit, then investors will be happy-ish. If this is mostly X1 R&D, then going forward, it means they wouldn't post losses like that, as the costs have already been written off.

+ Show (9) more repliesLast reply 3549d ago
die_fiend3549d ago

That's a lot of money to be losing on a console that is a categorical failure in every regard.

Maybe they should sell off this division after all

Gazondaily3549d ago

Oh how you and your fellow 'gamers' would love to that.

Letthewookiewin3549d ago

This in contrast to the PS4 already being profitable for Sony and selling almost double. This isnt good for Msoft and the X1.

Fanci3548d ago

Xbox One is selling better than the 360. Microsoft did well with the 360. So things are most certainly looking good for both companies, and not bad for Microsoft.

Magicite3549d ago Show
MultiConsoleGamer3549d ago (Edited 3549d ago )

EDIT: Sorry not taking the bait.

Author better check your math. It would really hurt your rep, possibly ruin it, when someone calls you out on your numbers. :)

Kidmyst3549d ago

If this is true, shareholders won't be happy and pressure might come to Xbox to make drastic changes or sell off the brand. This might explain all the leadership changes MSFT made earlier.

Anon19743549d ago (Edited 3549d ago )

You hit it right on the head here. Microsoft is a business and it's their job to run the company in a way that maximizes shareholder returns.

The Entertainment and Devices division, even when making money, pales in comparison to MS's other division when it comes to return on the money invested. To break it down simply (and this is just illustrative), if you invest ten million dollars each year into six different divisions, and five of those divisions return you 20% on the money invested, and one division continually brings in only 5% for a decade, at some point investors are going to revolt and demand to know why those investments aren't being put into more lucrative areas of the company. That's what we've been seeing from some of Microsoft's biggest investors and board members alike.

Launches are supposed to be expensive, but most of the expense is taken up with initial R&D and launch marketing. Those expenses were accounted for two quarters ago. These loses should be concerning to gamers as Microsoft is clearly in a period of transition, despite the lip service being paid to the Xbox brand. Microsoft PR seemed just as committed to the Zune back in the day as well. And we really don't even know how bad it's been historically as Xbox losses have always been masked by patent royalties in the past. To anyone paying attention, the XBox has never been more vulnerable.

system223549d ago (Edited 3549d ago )

ummm...

i agree that the xbox could be doing better in terms of sales but.... your comment is kind of naive. consoles are expensive not only to launch, but also to develop. look how much money it cost to develop the controller alone. also - margins on console margins are razor thin, if not losing money. it is expected that consoles make a lions share of the money through software and well... there just isn't a lot of great software right now.

granted this number is pretty crazy but i'm pretty confident a lot of it is not the result of poor sales, though more sales certainly wouldn't hurt.

the ps4's success is partially because of timing, partially because its a kick ass system but also partially because of luck. it had the perfect storm brewing for launch success.. people pissed at MS, pissed at xb1 policies and even more, some flubbed multiplat launch titles on xb1, people pissed about price with mandatory bundled kinect etc... had ms actually not made a slew of mistakes on their handling of the xb1 launch and promotion things would be tighter. at the end of the day the systems really are pretty close. xb1 just has a bad rep now.

iceman063549d ago

I'm sorry, but it is not luck when your competitor screws the pooch. Sony was just much wiser and less arrogant this time around. They didn't rest on their name and came out first. They created a machine with input from developers in the industry (listened BEFORE the launch). They even got in front on the reveal. None of this was luck. It was calculated and it seems to be working. On the other hand, MS was arrogant in its approach. It created a system that was hard to create a value proposition for in comparison to the competition. Even MS couldn't decide how to market their "All-in-one", "Always connected", "Only with Kinect" future. To compound that, they added in a dose of horrible PR blunders. Once again, this isn't tied to luck. It's directly tied to preparation and calculation.
That being said, these losses ARE probably tied to R&D, marketing, and licensing more than they are actual sales (unless MS severely over projected their sales). This is by NO MEANS the death knell that people imagine for MS. But, it can't make shareholders very happy because they want to squeeze every dollar they can out of the business. That's THEIR bottom line that MS is messing with.

chrismichaels043549d ago

I agree MightyNoX. A certain part of the gaming community loves to brag about Microsofts profits charts...but they ignore the fact that the majority of those profits come from Microsofts other non-gaming divisions.

gangsta_red3549d ago ShowReplies(1)
lawgone3549d ago Show
GiantEnemyCrab3549d ago

It's a console launch. You expend a huge amount of money. Gotta spend money to make money.

Orbertron3549d ago (Edited 3549d ago )

Money makes the world go round

3549d ago
Stoppokingme3549d ago ShowReplies(2)
RIP_Cell3549d ago

they didn't lose 400 million, they make 400 million less profit than last year, big difference

kenshiro1003549d ago

Did I read that right? 400 million?! Wow...

RIP_Cell3549d ago

wow? do you know how much Sony is on track to lose this fiscal year? 1 billion

kenshiro1003549d ago (Edited 3549d ago )

Is that for the gaming division? Because the last time I heard about it, they were profitable. In fact, Sony is recovering from their losses.

By the way, stop dragging Sony into this. This is about Microsoft.

otherZinc3549d ago (Edited 3549d ago )

It's amazing how many of you don't know a thing about business or how to read a financial report.

The XBOX ONE "is" profitable. It's been profitable from day 1.

The PS4 wasn't, maybe they should sell its games division. PS4 only became profitable "after" it laid off 100 ' of workers in each & every development house they own: Including, Guerilla Games, Naughty Dog, & Sony Santa Monica. Then they only made $12 per PS4 Sold, and that wasn't enough to remove Sony Stock from "Junk Status" by Moodys and Standard & Poors.

Some of you on this site are just silly.

Death3548d ago

It's incredible how no one is checking the link. The division made almost 1 billion in gross margin yet everyone here is saying they lost money. The cost of revenue increased which is why gross margin this year based on 3.2 billion more in revenue decreased by 63 million.

Revenue was up 49%, but the margin decreased 7%.

chaosx3548d ago (Edited 3548d ago )

https://www.worldpayzinc.co...

check this out , Doesn't look as if they should be too worried.

+ Show (20) more repliesLast reply 3548d ago
iamnsuperman3549d ago

That is an insane loss to be solely attributed to the Xbox platform. I doubt we are going to see a price cut anytime soon.

Tony-A3549d ago (Edited 3549d ago )

Agreed. It sounds counter-intuitive but keeping the price to at least $400 is really the only option they have right now and cutting price might only cause more damage.

I chalk it up to The Curse of the Third Console. Good or great debut, much more successful second coming and arrogance/pride destroys the third.

On one note, I would advise Microsoft to re-evaluate their goals and long term endeavors. They tend to always be that 12 year old kid that wants what the other kid worked hard for. Their software is a success because it was a user-friendly way of doing something that was already possible. But in today's generation, every market they've squeezed themselves into has come off as a "me too" approach. Phones, search engines, consoles, video game publishing, they all feel like a result of them seeing others making good money from it. Only difference is they don't really care if they do it better than others as long as they get a piece.

mmmmmmmmmbut I'm not a financial advisor...

Insomnia_843549d ago ShowReplies(3)
imt5583549d ago (Edited 3549d ago )

Around 100$ loss on each Xbone sold.

Well, don't expect pricecut anytime soon.

@Fishy

Quote :

"...Probably the same scenario with the 360 or any other company's launch of a major new product..."

Well, this gen Sony doing quite opposite.

@InTheLab

Quote :

"...Maybe I missed it but where does it say they lose $100 on each sold?..."

It is just pure calculation. 400 mil. loss and around 4.9 mil. Xbone sold ( i presume ). Well, maybe my calculation is wrong.

@Fishy :

Quote :

"...If they make a profit on the PS4 alone in its first fiscal year that's one for the books and they must of had a minuscule R&D overhead. Which seems unlikely..."

http://www.dualshockers.com...

http://www.eurogamer.net/ar...

InTheLab3549d ago

Maybe I missed it but where does it say they lose $100 on each sold?

Fishy Fingers3549d ago (Edited 3549d ago )

Well that good news for Sony then.

While I don't follow this as accurately as some I don't believe Sony posted outgoing revenue associated with individual products like is being done here.

If they make a profit on the PS4 alone in its first fiscal year that's one for the books and they must of had a minuscule R&D overhead. Which seems unlikely.

Fishy Fingers3549d ago (Edited 3549d ago )

Obviously a headline to grab attention. While revenue from the Xbox brand actually increased the outgoings did too. Like the article points out, your first fiscal year encompasses the additional R&D costs and marketing associated with launching a new product. Probably the same scenario with the 360 or any other company's launch of a major new product.

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270°

Microsoft’s Surface and Xbox hardware revenues take a big hit in Q3

Microsoft just posted the third quarter of its 2024 fiscal financial results. The software maker made $61.9 billion in revenue and a net income of $21.9 billion during Q3. Revenue is up 17 percent, and net income has increased by 20 percent.

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theverge.com
darthv721d 1h ago

Xbox content + services up 62% while hardware down 31%... seems about right with the way they tout you don't need the hardware to play. People can play on their phones or smart tv or other means. I don't hardly play on my consoles directly since getting devices like the logitech g-cloud and ps portal. Which is to also say I have been playing more digital than physical because of these devices.

solideagle12h ago

you should apply in MS PR team buddy, I think you will do a great job in my humble opinion :)

Sonic18819h ago

I thought darthv72 and Obscure_Observer already work for Microsoft 🤔

dveio9h ago

MS: "Xbox services and content without AB up 1%, with AB up 62%. Hardware down 31%. In total a loss of 350 mill."

darthv72: "Seems about right."

MS: "Excuse m ..."

darthv72: "I don't hardly play on my consoles directly."

MS:

Lightning774h ago

What he said was facts. How he plays games is no concern of you. Don't get too mad about it.

Cacabunga11h ago

I can tell people like you are an absolute minority..

If service is up means their fans and fanboys accepted this model and subscribed to it. The near future you will see a big decline because the service is saturated.

shinoff218310h ago

But that's been ms for years. When things aren't going their way they try to change the way things are said. For instance console sales are down, they stop telling how many sold instead telling us how many hours spent in halo or headshots. So it makes sense console sales down just say people are playing on more devices then previous. What they won't say is how many xbox players jumped ship to ps5.

Cacabunga9h ago

Hardware sales are so bad that Sony and Nintendo are blowing the sales off the water with their hardware.

If Xbox are losers, others aren’t..
Xbox already tried everything with Xbox live then subscriptions went down so much that they had to find something else. Their fans subscribed then reached saturation rather quickly.

Hardware and exclusive games is where it’s at! Keep gamers excited, announce decent software and people will support you

itsmebryan5h ago

@shin
Well keep it simple Sony 's operating income is down 26% and Microsoft's is up 32%. No MS spin there, just facts. 😉
Cheers

romulus234h ago

Odd that a company that touts you dont need the hardware to play is already touting another console in the works.

darthv724h ago

They are not reliant on the HW but still want to maintain a presence (no matter how small) is a good thing. It shows commitment to the craft. It reminds me of SNK and how they made games for their own hardware (Neo Geo) while also making them for others because they knew there was a market to do so. They knew they would sell more to others but also sell to their own niche fan base.

+ Show (2) more repliesLast reply 4h ago
purple10114h ago

Xbox hardware revenue tanks to lowest point of Xbox Series generation

Profchaos13h ago

I'm not surprised surface is struggling they aren't relevant anymore

DOMination-3h ago

In the last two years they've started exiting the consumer market altogether. All of the newest Surface products are business models only. They can't seem to work out what they want to do with it.

XBManiac13h ago

Too expensive hardware when others offer the same or more for less? Good work, Green Team.

SimpleDad12h ago(Edited 12h ago)

"Despite some early successes for Xbox games on rival platforms, Xbox hardware is down by a massive 31 percent this quarter."
"Without Activision Blizzard, Microsoft’s overall gaming revenue would have actually declined this quarter."
"Xbox content and services would have only been up a single percent without Activision Blizzard..."
"It looks like next quarter is going to be a similar story for gaming at Microsoft, too."

That is crazy... so A/B/K is carrying the whole Xbox gaming.
Oh and Microsoft will be fine. Windows, Office and Cloud are growing with each pc purchase.

purple10112h ago

Activision: "we gonna need a bigger rucksack/backpack please"

Microsoft: "why's that"

Activision: "to carry yo' weak ass'

Profchaos12h ago(Edited 12h ago)

Top brass have also wanted to start seeing returns on the 100 billion they have put into various Xbox related moves so seeing more multiplatform games is highly likely especially from abk

It's basically saying that PlayStation is the reason Xbox is afloat right now thinks to Ps5 versions of COD

Kornholic10h ago

So basically PS and PC gamers' money is keeping Xbox on life support.

MrDead3h ago

The only growth MS will get out of the console industry is if it supports it's rivals platforms. Xbox is a pointless machine now. I can see them on a big push for live next, and they won't give up on trying to buy Steam.

+ Show (1) more replyLast reply 3h ago
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300°

Microsoft Seemingly Closes Bethesda France

As part of its plans to cut 1,900 jobs, Microsoft has reportedly shut down operations at Bethesda France, letting go roughly 15 people

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insider-gaming.com
Hereandthere1d 21h ago

Microsoft should have left them stay 3rd party

GamerRN1d 19h ago

If they are let go, they can be whatever they want. They ARE 3rd party now... 🤦

Barlos1d 16h ago

Yeah, they're also jobless.

GamerRN1d 9h ago

They can form a company if they want, they are just as jobless as if "Microsoft had left them as 3rd party".

peppeaccardo1d 11h ago

"MIcrosoft leaves Bethesda do what they know how to do best" ... close! Oh the irony ....
(Citation from a week old article)

ChasterMies1d 7h ago

I think Microsoft and other game publishers are letting people go because they think ai will replace them. Doesn’t matter how much profit they make. They were always going to be let go.

PassNextquestion1d 21h ago (Edited 1d 21h ago )

Bethesda France was made up of roughly 15 people... they couldn't of being doing much

Bethesda France mainly did publishing and marketing within the region

blacktiger1d 19h ago

that's a shame for you to say that, i'm sure Elite loves hearing what you just said.

Mr Logic1d 5h ago

What a stupid thing to say. The elites give 0 fucks what we say on an obscure website in the comments section.

Crows901d 4h ago

You can always reach out and give them jobs at your company man. Don't wait

blacktiger1h ago

You own nothing snd be happy. I'm sure you heard that

Profchaos1d 21h ago (Edited 1d 21h ago )

Bethesda France focused on publishing and marketing in the region. And 15 people lost their jobs as part of the closure.

I wonder if this is part of Microsoft's strategy to abandoned physical media or possibly gamepass advertising makes their roles redundant you don't need to market a game as hard when the majority of players get the game as part of a sub which already promoted upcoming games

Tacoboto1d 20h ago

It's France too, there's a high likelihood only 1-2 people on the team even had an Xbox.

Profchaos1d 20h ago

Possibly guven all the leaks we know the Xbox brand is really struggling in the region.

Yi-Long1d 17h ago

Well, if your consoles and games are barely found in any stores any more, of course you're gonna struggle finding consumers ...

XiNatsuDragnel1d 19h ago

Tbh Microsoft I think Bethesda being 3rd party same with Activision would probably more competitive than thus scenario imo

Profchaos1d 18h ago (Edited 1d 18h ago )

I think it would have been better for all parties really especially gamers

TheColbertinator1d 19h ago

The recently purchased Activision French offices might take over all the licensing and marketing for Microsoft in France from now on.

Show all comments (23)
280°

Xbox's Preservation Step Sets A Much-Needed Example, Especially For Nintendo

Hanzla from eXputer inquires: "If Xbox can care about preserving its games and legacy, what exactly is wrong with Nintendo, trying to kill game preservation single-handedly?"

purple10113d ago

Ahh yes the good old game preservation of saving all your games to a removable hhd on the Xbox 360, taking it round your mates house, setting up multiple tvs to
Be met with “save data corrupted, please re download”

Or how about removing 360 games
From the store
, download them now or else, and, better hope to god that save data doesn’t corrupt, or it’s lost for ever

Nice one ☝️

Zeref12d ago

It's better than what Nintendo and Playstation is doing. It might not be perfect but at least they are TRYING. Unlike the others.

DarXyde12d ago

Trying? Take off the blinders for a moment, mate.

1. A failure to preserve games is just that: a failure to preserve games. Don't try to sugarcoat it: NO ONE is doing it properly. Better than awful is nothing to write home about.

2. At the time of this comment, isn't it the case that you need an internet connection to play Xbox games even if you buy physical discs that are hardly in circulation anymore? I don't have a Series X and I can't verify, but I think that is correct. I'm fairly certain you can at least play PS5 games at version 1.0 (not much of a win really when many games require day one patches). I think Microsoft's all digital, licensing approach is by far more aggressive than anyone else's. They really try to push you to game pass where you lose your entire library by umm.... Skipping a month of payments.

I don't think anyone is doing it right whatsoever. Don't get me started on Nintendo, who goes after anyone looking to preserve their games better than they ever would with extreme litigation.

Don't be a simp for any of these companies. Get it together.

PhillyDonJawn12d ago (Edited 12d ago )

@DarX never speak on Xbox again. You lost all credibility with your internet connection comment. Smh you have 0 clue and misinformed yet speaking on something you don't no squat about.

Einhander197212d ago

What has Sony done exactly? You guys keep deflecting to Sony but I am not actually seeing any results, and ai am certain nothing that you can come up with even comes close to what Microsoft has done and what they have tried and failed to do, like tie all your disks to your account on xbone.

Microsoft removed their whole indie section when they moved to the xbone because they were going to only allow games on the service that came from a publisher, id@xbox started after xbone launched and it only exists because Sony embraced indie and Microsoft was forced to cancel their plans and reverse course.

And every single game that was part of games for windows live including disk games (I have gta 4 on disk that won't work) so hundreds of games that use that DRM no longer work unless the company themselves patched it out which of course very few did.

MrBaskerville12d ago

Not trying. Tried. they killed of the backcomp program years ago. They set something up again, but sounds like it's more of an attempt to save the current library on whatever they are planning next. With luck they save everything and more, but let's see. I could see them killing off parts of the OG xbox and 360 libraries. Can't imagine that they would allow us to play Forza 5-7 in the future.

With that said, I do like what they've done and really wish they could have done more.

shinoff218311d ago

Zeref

So killing off physical media is trying what exactly. Ms don't really give a fk if you think they do your kidding yourself.

Profchaos11d ago

They are not trying this team is established for forward compatability the team is. It interested in preserving Xbox or 360 games.

+ Show (3) more repliesLast reply 11d ago
isarai13d ago

Is that why Hellblade 2 is digital only?

Zeref12d ago

Just because it's digital only doesn't mean you can't preserve it. Just put it on an external and you have the exact same functionality of what a disc does.

MrNinosan12d ago

Guess you're trolling, but if you actually think that's how it works, I'd recommend buying some braincells.

mkis00711d ago (Edited 11d ago )

Volitile vs nonvolitile data. A disc will not corrupt either. A drive can be corrupted.

Einhander197212d ago

This is just a scammy PR move to distract from the fact they are going digital only and trying to push streaming and subscriptions only.

No gaming company has pushed harder to remove ownership than Microsoft.

Without discs there is no preservation, preservation can't be done by the rights holders it can only be done by the consumers, anything else is a lie.

12d ago Replies(3)
Einhander197212d ago

Anyone remember xblig which Microsoft removed their whole 360 indie section removing hundreds of games from people?

12d ago
12d ago
Zeref12d ago

Do you know you can put your games on an external and preserve them that way? There are no benefits to discs. ZERO. Idk why some of you are still obsessed with them.

DarXyde12d ago

Because games like Persona 5 exist. It's STILL V1.00. On Playstation, that's a win because 1.00 is installed on the disc—no need to download anything.

If a game does not require any updates, it's all on the disc.

Extremely low bar in the modern era, of course. It's not much of a win by any stretch.

But for now, physical media does have a purpose, at least on Playstation.

Einhander197212d ago

That is factually not how game licensing works, try plugging your hard drive into someone else xbox, It's not going to work, and it won't work if the licensing servers ever go down.

Einhander197212d ago

Anyone remember games for windows live.

I have around a dozen games, some on Steam itself that will not work because Microsoft shut off the licensing servers.

BehindTheRows12d ago (Edited 12d ago )

I do. I STILL have games (Gears of War being the big one) I cannot access because Games for Windows LIVE is total garbage and no one has held Microsoft accountable.

Zeref12d ago (Edited 12d ago )

You don't have an Xbox apparently. Because you can 100 percent plug in your external and play games from it on any Xbox console lol. You just have to be logged in to prove ownership.

Chevalier12d ago

"You don't have an Xbox apparently. Because you can 100 percent plug in your external and play games from it on any Xbox console lol. You just have to be logged in to prove ownership."

Damn how many times do people got to explain your idiocy to you? You can take a copy of Persona 5 like someone used as an example and play that game on ANY console WITHOUT logging in which means I can lend the game to a friend without internet and they can play my game. Can you lend your hard drive to anyone without logging in for them to play? NOPE. That is a huge difference and if you think otherwise then sorry you're an idiot.

Tacoboto12d ago

"No gaming company has pushed harder to remove ownership than Microsoft."

Ubisoft is literally erasing games people bought from their libraries... My PS1-3 discs are useless on modern hardware. Nintendo's re-published and resold almost their entire Wii U library, and the eShop is completely dead with no BC mechanism in the Switch software. Microsoft publishes everything they make today day one on Steam and Xbox/Windows. Sony only brings to PC the titles they think you might want some years later and Nintendo won't even design a functional long-lasting joystick.

You're absolutely trolling and not serious if you think Microsoft today is the worst offender.

shinoff218311d ago

Yay steam

Not everyone fks with computers though. The disc is still the best way as a console player. Period.

Tacoboto11d ago

How do Sony and Nintendo feel about these discs from 2001-2013?

Don't be stupid, you know Xbox is the best at this today.

+ Show (3) more repliesLast reply 11d ago
Hofstaderman12d ago

Nobody wants this. Sales or the lack of it in the case of XBOX is very telling. I wonder how the adorably all digital series X will fare. Adorably dismal perhaps?

crazyCoconuts12d ago

Only time will tell, but for from someone like me suspecting that Xbox is trying to gracefully exit the console market, that "forward compatibility" team is trying to get Xbox games playing on Windows PCs. I mean, it's nice that they're not planning on exiting with a "enjoy your games while the hardware still works" message, so that's nice. They still have a brand to protect via Microsoft so probably feel obligated to have a better exit strategy.

Xeofate12d ago (Edited 12d ago )

That is not their plan, their plan is to transfer users accounts to the cloud.

Phil Spencer himself said as much a few months back, plans could have changed but I think people are reading way too much into one statement where Phil said he would allow Epic on xbox because he wants to be able to sell xbox games directly on other platforms. Aka, instead of selling Sea of Thives through PSN he wants to have an xbox store to sell his games on PlayStation without giving PlayStation any money.

Again, it's extremely unlikely that Phil plans to put PC on xbox and licensing would prevent them from just giving out other publishers games purchased on xbox copies of thier games on PC, Microsoft does not own their games.

crazyCoconuts11d ago

The thing that doesn't align with the cloud strategy is the giving up on exclusives. You'd still need strong exclusives for cloud streaming - it's still a "platform" , just with a lower upfront hardware investment. I feel like they've learned what PS learned with PSNow long ago. We're not ready to stream games and it's only gonna lose them money to try at this point

FinalFantasyFanatic11d ago

I would love that, I'd buy up some of the Xbox games if they could run on PC, like the Rare Replay, Lost Odyssey and Dead or Alive Ultimate, probably a pipe dream though.

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