Not sure what the total revenue was for Microsoft gaming across PC and console, but console alone was 12.4 Billion.
Playstation still the big daddy.
People thinking MS doesn’t want to increase their console sales are fooling.
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Gamepass
Xbox revenue in the fiscal year 2021 - ending June 2021 - should be 3.2 (Q1) + 5 (Q2) + 3.29 (this is what they expect in their Q3 outlook) + around 4 or 4.5 so around 15.5 or 16 billion.
23% market share is huge.
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This is just analysis. In other words the numbers are almost certainly wrong.
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Microsoft’s official figures for fiscal year 2020 are of around 12 billion too.
Are ppl saying they don’t want to sell more consoles? o.0
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Yeah, plenty of people saying MS isn’t that concerned with selling consoles, as they have bigger plans in Gamepass and xcloud. They latched on to a quote from Phil about it.
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I mean, console sales matter for lots of brand adoption reasons and for tech advancement for the baseline. I think Xbox no longer means consoles though. Xbox now seems to mean the universe of devices that can access Game Pass. That will grow dramatically this year.
When MS is announcing 15mil for SoT, 24mil for FH4, 18mil for ESO, 5mil for Grounded and you can only imagine what the other 1P stuff is gonna do numbers wise in the coming yrs…I mean, those are the numbers that actually matter ultimately and clinging to PS5 sales will only serve Sony fanboy rhetoric for so long when MS is completely changing the entire paradigm. The potential for MS 1P reach is fucking enormous and cannot be overstated.
I’ve been saying that for yrs and it seems like finally ppl around the industry are opening their eyes to the pieces MS has been putting together.
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Not having to rely on # of consoles sold to drive revenue / net income is not the same thing as not wanting to sell consoles.
The point is more that - because gaming revenues & net income are no longer solely reliant on selling consoles, they don’t HAVE to just sell consoles in order to do well.
Look at it this way: If Xbox sells you an Xbox Series X, that’s $500 in revenue. But chances are, at the moment, it’s a very small amount in their net income after they account for production costs & research, etc.
If they do NOT sell you a console, but sell you a game pass for PC subscription at $10 / month, with say the first 3 months for $1 - they only get about $91 from you for the year in revenue. Chances are however, that the net income they’d earn from this would be higher than the amount they got from selling you a $500 console that is fairly expensive to produce.
So the point is that - while they’re fine selling you the console, and probably would love to have you buy it (because you’re more likely to buy other services from them) - they don’t HAVE to rely on it in order to do very very well. The net income is MUCH
Sure, but there is also the 30% cut from all those 3rd party games that sell on their console. Sony make more money from the 3rd party sales than from their first party.
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Sure - and again - I’m not saying they don’t want you to buy the console… but they have ways to do well even if you don’t. Also - the point of XCloud is that they are aware that a large set of potential gamers don’t have the money to buy a console. They can still find revenue streams in the future from that subscription, with no need to care about if you bought the console. We’re still in very early days of this, but that’s yet another source of income that will have no dependency on having to sell consoles, and at the moment, PS has no answer to it.
They’re being really long term oriented by finding ways to make money that don’t fit the traditional thinking.
I agree they are widening the pie, as they should do. However the console is still a very lucrative segment which they would 100% be trying to increase sales wise over the last gen. Playstation basically saved Sony from bankruptcy. Not to mention the cash that Nintendo is rolling around in due to their hardware.
MS definitely want to sell you a console, and then sell you games on that console. However, MS has found that gamepass is a way to make money off of gamers that were never going to enter the Xbox ecosystem otherwise (Gamepass PC / Series S gampass Second console), in other words they’ve grown a new market where they are not yet directly competing with Sony and Nintendo.
In the medium term, gamepass represents a huge chunk of potential recurring revenue with a very high profit margin, which is why the rest of MS is throwing its weight behind it.
If i was sony, what i’d really worry about is that Xbox has been very effective at using gamepass to increase its mind share with consumers. It is only a matter of time before that mind share is converted to market share.
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Xbox’s long-term goal - like in 20 years - is to have a full cloud ecosystem where publishers’ put their games on their Xbox cloud and Microsoft gets the 30% of every sale. Consoles are a temporary thing.
Just like Xbox getting the 30% of every sale is justified by them paying for the hardware, their future cloud ecosystem will be justified by them paying for the servers and the cloud infrastructure. But Xbox will save a ton of money in transportation, production, etc.
is this true?
Cuz if so, they made more money than Nintendo which is very hard to believe.
It’s true. Xbox official figures were of a bit less than 12 billion for fiscal year 2020 - ending June 2020 - . Revenue for calendar year should be higher, so 12.4 sounds plausible. We know they made 5 billion only in Q4CY20.
And I don’t see why it is so hard to believe.
When Game Pass reached 10 million users, the Gold conversion didn’t exist, meaning the majority of Game Pass subscribers are paying the standard fee, so 120 or 180 dollars a year, that is a ton of money and all of it goes to Microsoft (there are no middlemen, all goes to Microsoft directly).
Nintendo users buy mainly physical games, and Nintendo only gets around 27 dollars of every 60 dollar physical game because of retailer fees and other costs (https://gamerant.com/video-game-prices-breakdown-514/). Not to mention NSO is a joke and excessively cheap compared to Gold and that Xbox has additional revenue streams like Steam and PC, where Nintendo doesn’t operate.
Xbox also has Minecraft which is a huge money maker on its own. And COD, Assassin’s Creed, etc. They get 30% of those games and they are huge. And those are not on Switch.
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Okay, turns out it was actually 13.83 billion USD. So even higher than this estimate.
Xbox revenue in calendar year 2021 should be around 16-17 billion USD. Calendar year revenue is always higher than fiscal year revenue because the Xbox business keeps growing.
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Yep, Microsoft is doing just fine people with the Xbox division and people should stop worrying, which crops up from time to time.
Three things I would like to comment on though.
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That should be a very good indicator to people how big Tencent is when they are making far more money than Sony when it comes to gaming even though I thought PlayStation was the center of the gaming universe
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Microsoft and Nintendo are shockingly close despite the Switch being a sales monster and Nintendo dominating the game sales charts.
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The traditional console makers are doing extremely well and echos Phil’s sentiments that Xbox does not have to destroy the competition to do well. There is an interesting observation though in that PlayStation has outsold the Xbox by more than 2:1 but it is not quite reflected in the revenue generated indicating that Phil’s current strategy is working in terms of expanding the customer base for XBox and there is plenty of room to grow.
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Nintendo has always been behind Xbox in terms of revenue, as a matter of fact. It’s only last year - 2020 - that Nintendo surpassed Xbox. I think Xbox is bound to surpass Nintendo again within the next 5 years or so.
You are totally right in what you say.