Microsoft reported the results of its fiscal fourth quarter today, and we got some hard numbers about how the Xbox One and Xbox 360 are performing.
The Xbox One and Xbox 360 combined to sell 1.1 million systems to retailers during Microsoft’s Q4 of fiscal 2014, which ended June 30. That’s up from 1 million (just Xbox 360s) sold over the same period year-over-year. While that is only a 10 percent increase, the Xbox One costs much more than the Xbox 360 did during fiscal 2013, so Microsoft’s revenue from Xbox was up 14 percent to $104 million. That, along with improved sales for Microsoft’s Surface tablet line, helped lift the company’s hardware division. Computer and gaming hardware were up a total of 23 percent to $274 million for Q4.
Microsoft notes that the Xbox platform was one of the major drivers of the growth in its hardware business. While Xbox One and Xbox 360 sales are growing for the company, Microsoft only detailed how many consoles it shipped to retailers. The 1.1 million number does not represent how many Xbox Ones consumers bought from April through June.
In April, Microsoft confirmed that it had shipped 5 million Xbox Ones to retailers as of the end of March. This means the corporation has around 6.1 million of its next-gen consoles in consumers hands or in the retail chain. That is still well short of Sony’s PlayStation 4.
Also back in April, Sony announced that it had sold 7 million PlayStation 4s to consumers. Again, that isn’t a direct comparison to Microsoft’s number because Sony was counting how many people bought the box from retailers while Microsoft was only revealing how many it provided to retailers in the first place.
Overall, Microsoft missed Wall Street’s earnings expectations, but that was likely largely due to its recent acquisition of Nokia. The company cut 18,000 jobs last week, including many from its Xbox teams in Europe, the Middle East, and Asia as well as the team responsible for original television programming on Xbox Live. Those massive layoffs should help its earnings bounce back in fiscal 2015.
Prior to those layoffs, Microsoft chief executive officer Satya Nadella wrote an extensive blog that included a commitment to the Xbox One.
“Microsoft will continue to vigorously innovate and delight gamers with Xbox,” he wrote.
While the Xbox One is selling better than the Xbox 360 was at this point, it is still facing a number of obstacles. The PS4 is outselling it, and that put pressure on Microsoft to get aggressive with the Xbox One and its pricing. In May, the company revealed it would start selling an Xbox One for $400 without the Kinect 3D camera. That was essentially a $100 price cut compared to the previous bundle. That puts the system at price parity with Sony’s $400 PlayStation 4.
The $400 price help Microsoft double the sales of the system from May to June, but it still wasn’t enough to outsell the PlayStation 4. The company is now hoping that its lineup incoming new games will help draw consumer attention.
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