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Microsoft ships 11.7 million Xbox consoles in 2014, a modest gain

Full-year results for the company overall show gains, but pre-price drop Xbox One performance doesn't move the needle for the quarter -- or much for the year.
Today, Microsoft released its fourth quarter 2014 and full-year 2014 results for the period ending June 30th, 2014. The company overall saw revenues of $86.8 billion for 2014, a notable increase from last year's $77.8 billion. Microsoft overall saw still-gigantic profits (operating income) of $27.76 billion for the year, up from 2013's $26.76 billion. For the fourth quarter, it saw operating income of $6.4 billion, up from $6 billion in the fourth quarter of 2013 -- this despite some significant setbacks, including a $692 million loss associated with its new phone business, acquired from Nokia. Growth of cloud services and Windows revenues more than offset that, however. Following an internal re-organization, its newly christened Computing and Gaming Hardware division, which contains both the Xbox and Surface tablet hardware, saw quarterly revenue of $1.4 billion, a slight increase from $1.1 billion in the same quarter of 2013, and $9.6 billion for the year, a leap from $6.4 billion the year prior. The company shipped 1.1 million units of Xbox hardware (including both the Xbox 360 and Xbox One) to retailers during the quarter, a modest year-on-year gain of just 100,000 units despite having a new system on the market. Overall, shipments of both of its Xbox consoles added up to 11.7 million in 2014; last year, during which Microsoft only shipped Xbox 360s, it sent 9.9 million units of hardware to retail. The Xbox One was on sale for more than half of the fiscal year, having launched on November 22 in North America, parts of Europe, and elsewhere. Xbox hardware revenue for the quarter grew by $104 million, which the company mostly chalks up to the higher price of the Xbox One. As promised, Microsoft used the quarter to draw down existing inventory of Xbox systems, it said. The company didn't provide any information on the performance of its first-party games or Xbox Live business. The Xbox One dropped its price during the quarter, but just at the very end (the quarter ended June 30; the price drop took place June 9.) The drop caused a kick in the pants for sales of the Xbox One, but not enough of one to beat the PlayStation 4 in the U.S. marketplace last month.

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