810°

Xbox Console Sales Decline Causing 33% Hardware Revenue Drop; Xbox Live Active Users Grow 33% YoY

Microsoft just released its financial results for fiscal year 2016, ended on June 30th. The full figures can be seen below, and they are firmly in the black. Yet gaming revenue is lower year-on-year due to declining Xbox console sales.

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dualshockers.com
Thatguy-3102836d ago

Curious to see if xbox one s and Scorpio will turn things around for them as far as hardware goes.

Herbalistic2836d ago (Edited 2836d ago )

Scorpio won't do much being as the mainstream crowd aren't willing to pay a hefty price tag.The upgraded console is aimed more towards hardcore fans that have no issue with paying more $$$ for performance. The Xbox problem is that it needs to expand/become established in other areas outside of the states &uk.

Cindy-rella2836d ago

The xbox scorpio is 15 months away and with playstation getting more market share i dont see xbox gaining back much ground. The xbox one s sales might increase slightly this year because i know microsoft will have some crazy deals where the system might cost a third less of initial asking price. I think in early part of next year the xbox one s will barely sell and ps4 will be selling 3 or 4 times more monthly than the xbox one s. I think a lot of people would rather wait to buy the xbox scorpio at the end of 2017

Fatal-Aim2836d ago

Sounds to me like 1 Xbox one to every 20 people rather than those 20 people just going out to get an Xbox One of their own.

Kribwalker2836d ago

@fatal aim

You only need one gold account per Xbox one, and if you set it up right (like I have) you only need one gold for 2 Xbox ones and everyone gets it

Fatal-Aim2836d ago (Edited 2836d ago )

@ Kribwalker

That was my entire point earlier. Microsoft said sales declined 33% yet online jumped up year over year. The only explanation for that is more people are using the same Xbox One console rather than each individual running out to get one of their own, hence the 20 people to 1 Xbox One console rather than 20 people to 20 Xbox One consoles.

Do you see now?

rainslacker2836d ago

@Fatal

Except it disregards that active users isn't increased revenue, just MS own metric for measuring how successful XBL is.

MS reported this themselves. Revenue is down 9% for hardware, and the increase in revenue for XBL itself is only 4%....but go on to attribute those gains to higher spending ratios of the users they have. They even say that the decrease in revenue on hardware was only partially made up by the increase in XBL account spending.

One doesn't need an XBox to have an XBL account, and it would appear that revenue for XBL isn't increasing in proportion to the active users...or coming anywhere close.

itsmebryan2836d ago

How much is the hefty price tag of the Scorpio?

Mr Pumblechook2836d ago

'Xbox Live Active Users' includes free accounts and users on Windows 8 + 10 and users on Windows Phone.

These figures don't reveal the gain or loss of paying Xbox Gold subscribers.

Fatal-Aim2836d ago (Edited 2836d ago )

@ rainslacker

No one is arguing subscriptions, though. Online is either Gold or Silver so long as your console is connected. I'm just giving you the amount of people/accounts to a single Xbox One. LoL! I don't see what's so confusing here.

It seems a lot of you saw something here and ran with it without taking the time to see the bigger picture.

UltimateMaster2836d ago

Anyone surprised by this?
They have announced the Scorpio, so people are going to wait to get that console instead.
Or at the very least the Xbox One S. But my bet is on the Scorpio.

2836d ago
bouzebbal2836d ago

I think we are witnessing the fall of the xbox hardware.. I still think they should remain in gaming as an online service

Kingoftherodeo2836d ago

same thing was said about elite controller and people still went out and bought it

rainslacker2835d ago (Edited 2835d ago )

@Fatal

Except that the number isn't tied to Xbox One. The number itself is across all the platforms it's available on. That includes X1, Windows, iOS, Droid, and Windows Phone/Tablets. Given the way the numbers are given, with no breakdown for analysis, it's impossible to say that those numbers indicate increased consoles on the market, or that multiple people are using whatever X1's are out there on the market.

It's reasonable to assume that some portion of them are due to more consoles, but the more logical conclusion is that the rather dramatic increase is due to how they've opened up the service to more devices...which IMO is reinforced by the fact that the revenue increase isn't in proportion to the increased users, because in the past, increased console sales tended to see a closer margin between increase users and revenue.

If one were to extrapolate data, if you look at around the holiday last year, it's been assumed that MS is around the 20 something million mark for consoles sold. A 33% increase would indicate that they sold approximately 7 million consoles since the holidays until the end of last month. Given that they haven't been selling consoles at that rate up until now, it's hard to say how much of that number is tied to console sales. Although, you aren't wrong, it could also mean more subs per a single system, but logically, it's hard to imagine it's such a great amount as you posit.

IamTylerDurden12835d ago

The problem IS that xbox doesn't care about anything outside of NA, but it's also the fact that they just don't invest in 1st party studios. They roll out the same milked franchises every yr and expect it to be enough.

wellard2835d ago

Ill be getting the Scorpio and I don't consider myself hardcore at all. I still haven't picked up a second console to sit with my ps4 yet. When it drops, getting the Scorpio is a no brainer for me as it would seem silly to get the less powerful version especially considering how fantastic games look nowadays. I think the Scorpio will help out the Xbox division massively. We didn't get that huge generational leap with the one/ps4 (uncharted 4 aside) I think plenty of people are hoping the Scorpio scratches that itch.

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PhilSpincer2836d ago (Edited 2836d ago )

They will obviously see some sales from the Xbox one S. Although I think that most of the sales will come from previous Xbox one owners who will buy the system again.

Xbox isn't going to be bringing in many new customers anytime soon.

curtis922835d ago

Basing this comment on an article title I saw a few weeks back: They need to start selling games and stop trying to sell the box/brand.

Exvalos2835d ago Show
Letthewookiewin2836d ago

There's no saving that sinking ship. Mediocre system and mediocre exclusives will get you mediocre sales.

Kribwalker2836d ago

"CFO Amy Hood clarified that lower unit sales are mostly related to Xbox 360 and lower pricing to Xbox One"

RememberThe3572836d ago

I'm not really an Xbone hater, but I have to agree, the system has been a hugedisappoint for me on almost every level.

Ulf2836d ago

If I was buying games today, I think I'd prefer to be buying them for my future Scorpio, over the PS4 Neo, which I won't be buying.

I wouldn't could the XBox One out just yet. It's not so different from the PS4 that people won't continue to choose it, knowing that the games they buy are going to work great on their Scorpio.

mouzone2836d ago

there is a big difference between ps4 outselling the xbox and it being a sinking ship

LastCenturyRob2835d ago

mediocre exclusives? what planet do you live on!?

fiveby92835d ago

I can see why perhaps MS announced Scorpio so soon. They knew the hardware sales numbers were declining rapidly and hope by announcing so early to stem that tide.

rainslacker2835d ago (Edited 2835d ago )

@five

I can't see how it would stem the tide. If anything, it would cannibalize their X1S sales.

I feel the announcements was more to stem whatever hype and sales that Sony would get with it's own Neo, and potentially PS4 Slim because, at least from MS perspective, if the Scorpio is more powerful, and the concepts of game uniformity remain the same, people may prefer to wait it out.

MS threw out a big impressive number to get people interested, and they hope that it will be enough for the time being to curb anything that Sony could bring with Neo. Sony could obviously announce more features to get people interested, but MS kept enough in it's back pocket to counter that should it be needed.

It's a good business move to counter whatever may come from Sony's Neo announcement and offerings. Not sure how it will affect the X1S though, as that could go either way. Kind of a precarious situation MS was in in this regard, because they want to counter what Sony is supposedly releasing soon, but don't want to take away from X1 sales overall until they are ready with Scorpio. If they waited, and Sony's Neo took off in a big way, then it puts them in the same position they are now, where PS is so strong, they have no chance of evening out the discrepancy.

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Kribwalker2836d ago

"CFO Amy Hood clarified that lower unit sales are mostly related to Xbox 360 and lower pricing to Xbox One"

What I find nuts is that MS Profit for last year was almost Half of the total market value of Sony ($16.9 billion profit, $38billion total market valued for Sony)

DarkHeroZX2836d ago

Lol yeah its easy to look at them both and say that but i can assure you gaming had nothing to do with it.

Ashlen2836d ago (Edited 2836d ago )

That's PR talk, the 360 has been selling less than 10,000 units per month globally for over a year. You can't make me believe that really effected the over all hardware sales that much.

rainslacker2836d ago

Without number of units sold, it's hard to say if that's a misdirection, or a major factor. I find it hard to believe that 9% of their revenue was from 360 sales, as they've taken a dive, and while the X1 price drop was greater than 9%, it would stand to reason that if it did something to increase actual unit sales, that revenue would be made up through those increased sales. I'm willing to say it was certainly a factor to consider though, but it shows that people interested in older systems aren't moving onto the X1, and now MS has nothing that will cater to that roughly 9% of the market they claim exists.

The increase in XBL users looks impressive, but the revenue gains from it are nowhere near in proportion to what one would expect for an increased user base, meaning that much of those XBL active users are either non-paying users, or that a great number of them aren't X1 users, or purchasing games/products through said account.

thisgamer5032836d ago

@rainslacker

I'm willing to bet the increase in xbl users is new win10 users who happen to use the Xbox app which automatically creates a xbl silver account and attaches it to your MS account.

SNEAKY SNEAKY

leoms2836d ago

What I find nuts is that you think that MS profit was made by Xbox, lol. Good damage control though.

Kribwalker2835d ago (Edited 2835d ago )

@leoms

At what point did I say games div? Ms Profits 2016 = 44% of total Sony market value.

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kayoss2836d ago

next up on Xbox fans to do list when Xbox one s and Scorpio are released.
1. Graphic suddenly matter again
2. Number of consoles sold suddenly matter again
3. Power suddenly matter again
4. The size of the console suddenly matter again

donthate2835d ago

and to other fans:

1. Graphics suddenly doesn't matter again
2. Number of consoles sold suddenly doesn't matter again
3. Power doesn't matter again
4. The size of the console doesn't matter again

It works both ways!

trooper_2835d ago

If Halo and Gears couldn't do it, then the S and Scorpio isn't going to cut it.

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2836d ago Replies(3)
corroios2836d ago

The problem here is that the Xbox One is much cheaper then the PS4. Microsoft is already very agressive with the price, but they dont have the results.

StanLee2836d ago

The problem is the XBox One S leaked months ago and was expected given the previous generation's cycle. Why anyone would buy an XBox One over the last 4 months is beyond me.

Ashlen2836d ago (Edited 2836d ago )

Well to be fair the Neo was leaked way before Xbox Slim or Scorpio yet PS4 sales have stayed strong.

butchertroll2836d ago (Edited 2836d ago )

Problem is, those a financial results Q4 are from March till end of June and the whole year ( till end of June ). It has nothing to do with Xbone S.

Godmars2902836d ago

Wouldn't that equate to increased sales?

Maybe they're losing sales because they don't have the exclusives?

_-EDMIX-_2835d ago

Why? People purchase platforms to play games not merely just blindly purchase platforms unless something in their software catalog changes I don't see that changing

hirobrotagonist2836d ago

That's a big reason why the hardware sales are down. Why would anyone buy the current xbox one with the new systems coming out? I'm not talking about Scorpio either, I'm talking about the S.

King_Lothric2836d ago

These are results for a whole fiscal year. Can't use the xbox S or Scorpio excuse here since these results are not only of June 2016, where both console were revealed.

oakshin2836d ago (Edited 2836d ago )

Not a single person I know has a clue about the new consoles but me

Gamer92MMM2836d ago

That is expected , really curious what Scorpio might do once it is lunched

thekhurg2836d ago ShowReplies(7)
Salooh2836d ago (Edited 2836d ago )

True, really hope ms saw it coming before doing it. Slim and even scorpio will only help a bit but in the end they are moving to software business , hardware is really irrelevant to them now. If they didn't do this in purpose then they are too stupid lol...

What's sad is that they are already weak in term of software compared to other platforms, why would people buy games from their store except for their few games?. Hope they step up with that for everyone benefit. The only benefit for them now is that their games will get more sales from pc players. That's it...

rainslacker2835d ago (Edited 2835d ago )

I don't think Scorpio or X1S had much to do with their prior fiscal year. The timing doesn't match up to show such a large revenue drop for hardware itself, and dropping the 360 didn't even happen until about halfway through the fiscal year.

Most of the rumors, and even the announcement for Scorpio itself weren't even in the press, and certainly not the mainstream press, until about a month before the end of the fiscal year.

That being said, I'm extremely curious about how well both Neo and Scorpio will do. Not so much because it's a console war thing, or think that one will have a major impact on install bases or their discrepencies, but rather because it's a new paradigm for the console hardware, software, development, and consumer market, and I really would like to see the results just to see how the general consumer will feel about such things. It's something that's hard to ascertain by reading hardcore gaming forums, because we tend to not always represent the general market.

I've speculated enough based on the rumors, now it's just a waiting game to see how it all turns out.

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40°

Alone in the Dark Developer Has Been Hit With Layoffs

Alone in the Dark developer Pieces Interactive has been hit with layoffs a month after its release, as per the latest information.

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nintendopal.com
coolbeans10h ago

That genuinely, genuinely sucks. The reboot has clear flaws, but it really felt like a solid first step for this team to receive *greater* investment.

XiNatsuDragnel4h ago

Alone in the dark is a fun game so that's unfortunate

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Shenmue: Reclaiming the Path is a fan game using Dreamcast-era visuals, and tells a new story within the Shenmue saga taking place in both Hong Kong and Guilin. Its expected to release on September 16th.

Inverno5h ago

Something about recreating old school graphics in an era of HD high poly photo realism just hits a spot. I'm not nostalgic cause I mostly played GameCube and GB/A, but it's a visual style that gets over looked even by indies.

Rynxie1h ago

Definitely a fan project. Terrible hand animations. Some characters have very bad body proportions. Some look like little kids in adult bodies. Some have short arms, small head, big hips and so on.

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While the mainstream media always sees things turning in favor of the hero, here are 6 games that own being a bad guy.

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Pretty much all of these games listed are based around a morality system you don't have to be bad and you don't have to be good.

It seems to have left out some real amazing games like red dead redemption 1/2,ass effect and true crime la/ny

Tacoboto1h ago

Armored Core VI?

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Is something big coming soon to branch the story?

banger881h ago

No mention of Grand Theft Auto? Saints Row (original trilogy), Manhunt? Also The Suffering (depending on the ending you get).