I think that’s the pre interest and tax number
They’re not losing that big of a chunk because it just takes most likely a purchase or 2 of software to cover whatever loss that happens on consoles. If they remove consoles they’ll lose a significant amount of money on third party sales. There is no way they can make up the revenue that is generated from third party sales by dropping out of consoles and becoming a third party publisher.
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Net profit == profit after taxation
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so much this and if they dropped Xbox sure they have pc game pass but it also drops the people that would just move to PlayStation as so many people do not want to pc game.
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Yeah. Plus the Xbox customers that go to PlayStation are less valuable since they’re only going to get 70% out of them instead of 100% . They’re theoretically losing $20 on each sale of a game if they migrate to PlayStation. All of that doesn’t make sense just to sell a couple more units on PlayStation because the math doesn’t add up to make it worth the cost of shutting down their storefront to become a third party publisher . The only scenario they drop out is if consumers move on from consoles
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I think people are being too reactionary. Xbox hardware is underperforming, but there’s a ton of inertia to those things. 2022 was a disaster for MS 1st party, most of years prior weren’t spectacular either, Starfield and Forza Motorsport by themselves were never going to reverse years of poor reputation.
BUT Microsoft has built up a huge portfolio of 1st party developers and the impact will be felt in years to come. Eventually there will come an inflection point where a few critical hits and a rich backlog will sway the public perception of the Xbox brand.
Overall the Xbox division is still posting excellent results, so they can ride out a few quarters of middling hardware sales. But the console is an important springboard to build a hardware agnostic Xbox ecosystem and they can’t cripple it by bringing their entire catalogue to Playstation and Nintendo.
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So what’s Xbox’s biggest exclusive, is it still Forza Horizon? Is Starfield on pace to reach Forza Horizon numbers ? Do we expect Forza Horizon 6 in 2024? If Xbox can keep thier current momentum then surprise everyone with their biggest console seller next year, that’s something that will move the needle for both Gamepass and console sales.
C’mon bro. You dont care about console sales. Especially if you all ready have a series S or X. Forgive me but, any time I see someone say " I just want to see Xbox do better" it’s not often it’s genuine. I could be wrong, but…
That said, console sales are the old traditional model of doing business. It’s even archaic at this point. And unless you’ve been living under a rock, you know that Microsoft EXPECTS there to be a hardware decline. Phile said months ago that they aren’t going to out console anyone.
Don’t misunderstand; console sales are important . But not too Microsoft/Xbox. Sony and Nintendo rely heavily on hardware because they still utilize the traditional business model. With Xbox, the hardware is just one piece of the pie. Software and subscriptions are their forte. And in those two avenues, Microsoft is murdering the narrative this year. Next year will be HEAVY.
Starfield will be a very long seller, and probably selling more units than gamepass subscriptions, so more valuable in money (not so much strategically if Gamepass is the goal).
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FH5 attracted more players in the same timeframe, however it was a cross gen game. Regardless, FH and Starfield are different games, no one pitches Mario Kart against Zelda.
All this doom and gloom, and the Xbox hardware in the first three quarters of 2023 did noticeably better than Xbox One in any year after 2015.
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Xbox one after 2015 was a mess, partially saved by the Pro model release. Still, everybody was expecting Xbox series to do better.
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Xbox One crept up to about 55M when it was all said and done. MS expected in 2020 to sell 60M Xbox Series consoles by 2027, they may still hit that number.
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I do want Xbox to do better. As it helps getting more games that normally wouldn’t hit the platform, as we are seeing a lot of games that normally last gen would have completely skipped Xbox.
Just curious what Xbox’s biggest exclusive is. Maybe it’s not easily defined. They are different games no doubt. Well however you want to call it, Forza Horizon is one of Xbox’s biggest exclusive games. If Xbox has a Forza Horizon planned for next year, it will certainly sell some consoles and subscriptions. If Xbox has a call of duty day 1 Gamepass ontop of that it could be a massive 1-2 punch next holiday.
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We still talking about hardware lol. Look I understand people are concerned but MS leadership keep emphasizing “platform” in their interviews with the word consoles in the same sentence, it will be fine. I know people don’t want to hear this but this take time. MS/Xbox still has to market their product outside of the US/UK consistently, plus the games barely just came out. In the next two years is where we need to get our focus on, as a lot of the games that has been on development will come out in that time period. Also, next year is the start of the COD marketing, which can be a big booster for casual gamers. The foundation is set, so let’s relax a bit, a lot of their moves are meant for the future, not today.
FH5 imo.
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I’ll leave this here as it expresses my thoughts on the worries on console sales and Xbox’s strategy better then I could articulate them:
https://x.com/GameOverThirty/status/1717239233335664672?t=hQS5gWyj3Ju_W-2ZpygcHw&s=09
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I agree entirely that Microsoft had to pivot to their current strategy and it is the right one. The financial results show that.
I don’t think anyone is suggesting it’s the wrong strategy. I think the question is how much longer can an Xbox stay relevant as a dedicated console that relies not only on MS support but on third party support as it’s market share dwindles against a backdrop of a strategy where it’s certainly in MS’ interest to sell more consoles but almost the opposite approach is baked into their strategy.
The question is less are MS doing the right thing and more what are the long term consequences of this strategy as an Xbox console owner?
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But Sataya himself has stated that Microsoft will continue to produce consoles. In his interview he said this:
So, we’re looking forward to really doubling down both as a game producer and a publisher. Now we’ll be one of the largest game publishers and also as a company that’s building platforms for it.
The console isn’t going anywhere and if they sell 50-60m consoles it isn’t going to a problem because they are available on a bunch of other devices so the bottom line is safe. Most of those games are going to be exclusive to their ecosystem which is console, cloud and PC. The real truth is if they want to be successful they need to be on other platforms not just the Xbox console. We’re seeing the upheveal at Sony because they are coming to the same conclusion and they have double the console base. As development costs increase profits are shrinking and that’s simply a scary outlook for the whole gaming industry
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