Microsoft beats profit estimates, but Xbox sales slip

The company did very well in its core productivity and tech businesses, but its Xbox performance isn't what it could be.

Today Microsoft announced a profitable second quarter of its financial 2016, the three month period ended December 31, 2015. 

The company pulled in $25.7 billion in revenue and generated $6.3 billion in net income; Microsoft beat analyst revenue estimates of $25.26 billion for the quarter, and the stock has risen around 5 percent in after-hours trading as of this writing.

It's not all rosy news; while revenues in its games business increased 5 percent year-on-year, hardware revenues saw a decline of 9 percent. The company says Xbox Live, Halo 5, and Minecraft contributed to the positive news; and cited decreased sales of the Xbox 360 for the hardware shortfall. 

That implies that sales of the Xbox One are not filling the gap that Xbox 360 is leaving, which lends more credence to a report which suggests the console is being outpaced by Sony's PlayStation 4. Microsoft has ceased reporting hardware sales in its financial reports.

The other clue we have is this: There was a "slight" decrease in Xbox One's hardware revenue, the company said, thanks to higher volume of units sold year-on-year against a lower sale price for those devices, so at least we know there was an uptick in hardware sales compared to holiday 2014.  

The company further revealed that Xbox Live users grew 30 percent year-on-year, with 48 million monthly active users -- although these user numbers and/or revenue reports could include Windows 10 gamers using Xbox Live services on PCs, phones, and tablets. A year ago, Sony reported that it had 64 million monthly active users of its PlayStation Network and Sony Entertainment Network, when the company merged them into one service.

Latest Jobs


Hybrid, Cambridge, MA or Chicago, IL
Quality Assurance Lead

Bladework games

Remote (United States)
Senior Gameplay Engineer

High Fidelity, Inc.

Game Interaction Designer

Fred Rogers Productions

Hybrid (424 South 27th Street, Pittsburgh, PA, USA
Producer - Games & Websites
More Jobs   


Explore the
Advertise with
Follow us

Game Developer Job Board

Game Developer


Explore the

Game Developer Job Board

Browse open positions across the game industry or recruit new talent for your studio

Advertise with

Game Developer

Engage game professionals and drive sales using an array of Game Developer media solutions to meet your objectives.

Learn More
Follow us


Follow us @gamedevdotcom to stay up-to-date with the latest news & insider information about events & more