Summary
Xboxconsoles undersold in the last quarter of 2023, and Microsoft CFO Amy Hood says that hardware sales will continue to decline over the next few years. This statement follows the news ofXbox’s impressive software and content sales, despite the recent controversy surrounding mass layoffs at the start of this year.
ThoughXboxfound success with the Xbox 360, it would eventually be overtaken by PlayStation, which would go on to hold a major lead in market share throughout the eighth console generation and into the ninth. Despite floundering hardware sales, Xbox has managed to maintain a strong grip on software and content, which has been ostensibly tightened thanks to major, expensive acquisitions like ZeniMax (Bethesda) and Activision Blizzard, which includes the mobile games giant King.
Xbox’s console revenue is expected to drop year-over-year, according to comments made by Amy Hood, as reported byThe Verge. DespiteMicrosoft’s new status as a $3 trillion company, hardware sales are down across the board, with Xbox consoles in particular selling less than expected during the 2023 holiday season. Hood points to a “weaker than expected console market” when discussing the platform’s poor sales numbers last year, while predicting that revenue from Xbox hardware will decline over time.
Xbox Hardware Sales Are Down, But Software Revenue Is Projected to Increase
Hardware sales may be down, but Microsoft’s gaming division appears to be doing well overall. Hood explains that the company has high expectations for gaming sales following the Activision Blizzard acquisition, andXbox Game Pass continues to grow, proving to be a consistent element of the Xbox brand, extending far beyond Microsoft’s hardware. Overall, the forecast for Xbox revenue is positive, even if hardware sales are expected to remain below competing brands like PlayStation and Nintendo.
While there is plenty of debate surrounding each leading console and why one may be outselling the other, it’s important to point out that a decline in hardware sales is a natural part of any console’s life cycle. Still, Hood’s comments, along with Xbox’s lower-than-expected console sales, offer some insight into the company’s focus on software versus hardware. WithXboxnowcontrolling flagship franchises from Activision Blizzardand Bethesda, the projected increase in content revenue seems likely, even if the brand continues to lag behind when it comes to console sales.
Microsoft Xbox Series X
The Xbox Series X boasts the fastest CPU and GPU configuration currently available for a current-generation console while offering 1TB of fast SSD storage for users out of the box.It comes with an Xbox Series S|X controller, a power cord, and documentation along with a trial for Xbox Game Pass Ultimate in the box.
