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Xbox One makes gains even as Microsoft takes a $2.1 bn loss

The company makes a major loss for its latest quarter, but Xbox hardware revenues are up a robust 10 percent year-on-year, despite an Xbox One price cut and the sunsetting of the Xbox 360.

Today Microsoft announced its fourth quarter 2015 results, for the three-month period ending June 30, 2015. Revenue was down five percent year-over-year, falling to $22.2 billion, down from $23.4 billion. The company made a loss of $2.1 billion for the quarter.

A huge write-down of its Nokia smartphone business acquisition (to the tune of $7.5 billion) is the culprit for the negative news surrounding the company's latest results; as of this writing, shares are down nearly 3 percent in after-hours trading despite the company narrowly beating analysts' revenue estimates.

Xbox performance

The good news for Microsoft is that the company's Xbox One console has improved its fortunes; the Xbox business is overall up 27 percent year-on-year thanks to "strong growth in consoles, Xbox Live transactions and first party games," the company said in its results release.

(First-party games would include Minecraft, notably, which Microsoft CEO Satya Nadella recently said the company acquired thanks to its popularity.)

Hardware revenue is also up 10 percent year-on-year, "driven by higher volumes of consoles sold" -- this despite price cuts to the Xbox One over last year. It's notable that this increase comes as the Xbox 360 effectively ends its commercial lifespan. Microsoft groups together sales of both of its consoles in its earnings reports.

The company sold 12.1 million consoles in the full year, up from 11.7 million for 2014. It sold 1.5 million in the quarter, up from 1.1 million during the same quarter of 2014.

Revenues for the company's Surface tablets also grew 117 percent year-over-year, which lends some credence to its cross-platform strategy, even if its phone business is foundering.

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