Despite posting a $2.1 billion operating loss for the fourth quarter of its fiscal year, Microsoft has noted that both its Surface and Xbox divisions witnessed substantial growth, and that the Xbox One is beginning to build momentum off the back of backwards compatibility and the forthcoming holiday line-up.
Speaking during today’s earning presentation, the publisher’s CFO Amy Hood revealed that total revenue for Microsoft’s Xbox division rose by 27% over the same period last year, with Hood pointing to first-party sales and an increase in Xbox Live transactions as the main reasons for the profit boon.
“This progress, as well as the excitement we generated at E3–with Xbox exclusive gaming content and backwards compatibility–demonstrates the building momentum that exists within the Xbox ecosystem.”
Similarly, the Surface line enjoyed a healthy increase in sales relative to last year, with the Surface 3 and the Surface 3 Pro pushing profit margins up 117% in total. Considering the hyper-competitive nature of the tablet market, such an increase is certainly not to be baulked at, and Hood touched upon how bringing the fiscal year to a relatively successful end “with solid progress against our strategic priorities, through strong execution and financial discipline.”
Beyond Surface and the Xbox divisions, Microsoft pointed to tertiary products such as the Bing search engine and Office365 as contributors to the overall momentum.
The month of July is a huge period for Microsoft as a whole with the imminent launch of Windows 10. Due to arrive on July 29, the new-fangled operating system will have a marked effect on the PC landscape and Xbox One interface, which is due to get a UI overhaul to dovetail with the company’s new technical aesthetic.
As for the Xbox One in particular, with a boisterous holiday line-up waiting in the wings – one that undeniably towers over that of Sony’s – we have every reason to believe Hood when she hints of the console’s building momentum. Gone are the days when Microsoft’s current-gen console was relegated as the underdog.
