Microsoft quarterly results show Xbox revenue up, but hardware revenue down

[Sparda3g]

Here’s what I don’t get. If you expect them leaving console, who’s going to handle the home television aspect? You honestly believe they will go to Nintendo or Sony. This is like WWE selling to AEW what movement. If there’s no one else, then they’ll do it themselves.

[strawman]

@Zappy5

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?

Last gen Xbox sold about 45% of what Playstation 4 did, and so far this gen appears to be selling about 55% of what Playstation does. That is enough for most publishers to support the platform, they don’t want Playstation to be the only kid on the block any more than customers do (fanboys notwithstanding), the market needs a viable alternative.

Small/niche games are a different thing sadly, and if porting the game to Xbox won’t reach the breakeven point, then those games might sadly skip the platform. But by and large the 3rd party support won’t dwindle in the coming years.

[Zappy5]

@strawman

Last gen Xbox sold about 45% of what Playstation 4 did, and so far this gen appears to be selling about 55% of what Playstation does. That is enough for most publishers to support the platform, they don’t want Playstation to be the only kid on the block any more than customers do (fanboys notwithstanding), the market needs a viable alternative.

Small/niche games are a different thing sadly, and if porting the game to Xbox won’t reach the breakeven point, then those games might sadly skip the platform. But by and large the 3rd party support won’t dwindle in the coming years.

Not sure on those numbers…Xbox is tracking behind the Xbox one and last I checked PS5 is slightly ahead of PS4…

[Zappy5]

@Sparda3g

Here’s what I don’t get. If you expect them leaving console, who’s going to handle the home television aspect? You honestly believe they will go to Nintendo or Sony. This is like WWE selling to AEW what movement. If there’s no one else, then they’ll do it themselves.

I think the discussion is that if their console sales dwindle they could be at a point where it makes more sense to be a third party publisher given that their aim for higher margins would be met by that move and whilst they’d lose the 3rd party cut it would depend how much that is offset by sales on other platforms and not losing money on hardware.

I mean they are already taking a hit on 3rd party software revenue by buying ABK and yes that transfers into the first party line so it’s not a loss, but we simply don’t know what the value break even point is on consoles for Microsoft and can’t know.

[GamepadX]

I just read on other era that PlayStation claims 1/3 of thier PlayStation plus subscribers are on a higher tier, which led a user over there to put that number at about 16 million.

Basically Xbox Gamepass has double PlayStation Plus numbers if you compare the 30+ million Gamepass subscribers tothe 15+ million PlayStation Plus extra premium ultimate or whatever they call it subscribers.

For all this talk about slow gamepass growth, seems like comparing them to the competition keeps that in perspective. PlayStation twice as many consoles, Xbox twice as many premium subscribers.

[Sparda3g]

@GamepadX

I just read on other era that PlayStation claims 1/3 of thier PlayStation plus subscribers are on a higher tier, which led a user over there to put that number at about 16 million.

Basically Xbox Gamepass has double PlayStation Plus numbers if you compare the 30+ million Gamepass subscribers tothe 15+ million PlayStation Plus extra premium ultimate or whatever they call it subscribers.

For all this talk about slow gamepass growth, seems like comparing them to the competition keeps that in perspective. PlayStation twice as many consoles, Xbox twice as many premium subscribers.

The odd thing is, PS decided to stop reporting PS+ numbers.

[strawman]

@Zappy5

Not sure on those numbers…Xbox is tracking behind the Xbox one and last I checked PS5 is slightly ahead of PS4…

Series X is estimated to be at around 25M. PS5 was at 40M at the end of June, and if we assume they sold 5M last quarter (they sold 3.3M in July-October '22), that puts them at 45M. 25/45 = 0.55

XB1 final shipments are estimated to be around 55M, PS4’s stopped at 116M. That would put Xbox at 47% of Playstation last gen.

https://twitter.com/Welfare_JBP/status/1716915911565971743

I know dooming and glooming is your shtick, but the situation is not that dire. In late 2021 Xbox made the decision to make all Zenimax games console exclusive, contrary to the prior ‘case by case’ scenario. With content and services doing stellar, thus relieving Xbox from any knee-jerk overreaction, Microsoft can ride out a few slower quarters on the hardware side until the increased 1st party output truly kicks into gear and only then assess if it has impact on console sales or not after that.

[KakkaKarrotKake]

Xbox will announce their hardware for 2028 and people will still be talking about them leaving

Some people need a new hobby

[strawman]

@KakkaKarrotKake

Xbox will announce their hardware for 2028 and people will still be talking about them leaving

Some people need a new hobby

Yup, been seeing the MS is leaving the console space since 2007.

[Sparda3g]

If you ask me, the whole leaving console is too early to call. That said, honestly, this feels like a discussion of “need of fear.” Xbox has reinforced significantly financially and output speaking. So what’s left to speak negatively? Try console departure. If that is countered, we will be fear of no fear.

[Zappy5]

@strawman

…nd if we assume they sold 5M last quarter (they sold 3.3M in July-October '22), that puts them at 45M. 25/45 = 0.55 XB1 final shipments are estimated to be around 55M, PS4’s stopped at 116M. That would put Xbox at 47% of Playstation last gen. https://twitter.com/Welfare_JBP/status/1716915911565971743 I know dooming and glooming is your shtick, but the situation is not that dire. In late 2021 Xbox made the decision to make all Zenimax games console exclusive, contrary to the prior ‘case by case’ scenario. With content and services doing stellar, thus relieving Xbox from any knee-jerk overreaction, Microsoft can ride out a few slower quarters on the hardware side until the increased 1st party output truly kicks into gear and only then assess if it has impact on console sales or not after that.

I’m pretty positive where Xbox is concerned they are doing amazingly well. I am just explaining where the argument that potentially they could leave the dedicated console space comes from .

Part of it is simple devils advocate…I don’t think they will abandon consoles…but I also don’t think the conversation is entirely without merit. Simply put when your whole strategy is to reduce the importance of console sales, and in doing so reduce the incentives for buying one at some point it’s probably you will stop making them. I think the only question is when they reach that tipping point. I think it’s probably beyond next gen and a bit academic but it’s not impossible that they get there sooner….

[EPC]

If the Xbox Series sell as more as the Xbox one, this is already something positive considering the Xbox one gen was devastating and sony came out so strong.

[ShinMegamiTenseiX]

Of course hardware is down. Ms barely ship the series x.