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[Astray]

That’s exactly how you ‘make’ money. Do you want a business generating $500,000 profit a year on $1m revenue or a business generating $1 dollar profit on $13 billion in revenue?

Microsoft is running a business with zero profit so your entire rhetoric is pointless here.

 

[Mattyp]

Microsoft is running a business with zero profit so your entire rhetoric is pointless here.

What business are they running with zero profit? I’ll need to see that in the quarterly’s I missed it in the last share holders meeting

 

[Astray]

What business are they running with zero profit? I’ll need to see that in the quarterly’s I missed it in the last share holders meeting

OK, name the Gaming divisions profits.

 

[Mattyp]

OK, name the Gaming divisions profits.

I don’t need to, you claimed it didn’t make a profit so I’m waiting for the receipts on that statement.

So you believe the xbox division costs more than $22BILLION a year to run?

 

[Mr Moose]

Includes games sold not on Xbox.

What a weird article.

And they link to Welfares video as some kind of proof it sold 35M. Such a compelling case.

 

[ChorizoPicozo]

I don't understand what Phil wins by pushing this damage control and spin. it's like no one cares when we see the ship sinking in real time, in 4K, HDR at 120 Hz with raytracing.

 

[nowhat]

in 4K, HDR at 120 Hz with raytracing

Not going to lie. The other day I was walking outside at night, there were lovely reflections coming off the lake. And I found myself tilting my head back and forth, coming to the realization that "yup, no SSR there, that's ray tracing".

...and then I realized I probably don't go outside often enough.

 

[Horseganador]

The press has been talking about damage control at full blast for a couple of days now since the impressive PS5 stats.

 

[Sooner]

If you can't beat 'em, pretend you did.

 

[John Wick]

Damn, makes Sony's revenues seem like chump change. Sony bros, I don't feel so good

Why?
MS spent 80 billion acquiring AB. There goes that revenue.

 

[ManaByte]

So you believe the xbox division costs more than $22BILLION a year to run?

Shawn Layton said that Game Pass requires $5 BILLION a month to run. So they're obviously bleeding billions of dollars and will be out of business by Wednesday.

"It's very hard to launch a $120m game on a subscription service charging $9.99 a month. You pencil it out, you're going to have to have 500 million subscribers before you start to recoup your investment."

500M subs at $10 a month would be $5 billion a month.

 

[ZehDon]

Microsoft is running a business with zero profit so your entire rhetoric is pointless here.

OK, name the Gaming divisions profits.

These posts contradict each other.

In all likelihood, I imagine they're making money, but not a lot, and certainly not enough money to qualify as a solid growth opportunity for shareholder investment. Hence why they remain mum on the matter.

Shawn Layton said that Game Pass requires $5 BILLION a month to run. So they're obviously bleeding billions of dollars and will be out of business by Wednesday.

I mean, we have the ballpark from Microsoft themselves, and they're not allow to lie about their revenue and expenses, so I tend to believe them.

 

[ChorizoPicozo]

I don’t need to, you claimed it didn’t make a profit so I’m waiting for the receipts on that statement.

So you believe the xbox division costs more than $22BILLION a year to run?

you can look at play station's profits and then ask yourself:

if Playstation has these kind of profits when:
1. the are making money with every console sold
2. they make 30% of every transaction
3. their big games are making between 700 hundred million to 1B in revenue

How can Xbox be profitable when:

1. they are loosing money with every console sold
2. they have destroyed the economy of games inside their ecosystem (games sales have plummeted)
3. they have to pay third parties to release games on game pass.
4. Now they are paying for Zenimax and ABK wages and operating cost.
5. Xbox had a decline of 7% in overall revenue YoY

 

[ManaByte]

In all likelihood, I imagine they're making money, but not a lot, and certainly not enough money to qualify as a solid growth opportunity for shareholder investment. Hence why they remain mum on the matter.

The gaming division is now the #1 games publisher. It takes some amazing mental gymnastics to think the #1 publisher isn't making a profit.

 

[Radical_3d]

 

[DR3AM]

MS making $$$ and people here can’t handle it. LOL

 

[zedinen]

Damn, makes Sony's revenues seem like chump change. Sony bros, I don't feel so good

March 2024

 

[rickybooby87]

In the most recent fiscal quarter ending December 31, 2024 (Q2 of fiscal year 2025), Microsoft's gaming revenue totaled approximately $6.58 billion.
Source: https://www.statista.com/statistics/831590/microsoft-quarterly-gaming-revenue/

In the third quarter of fiscal year 2024 (October to December 2024), Sony's Game & Network Services division, which includes PlayStation, reported revenue of ¥1.68 trillion (approximately $10.9 billion).
Source: https://www.sony.com/en/SonyInfo/IR/library/presen/er/pdf/24q3_sonypre.pdf



Even though Microsoft went out and bought new revenue streams, they still aren't pulling in more revenue than the PlayStation division, now, that could change at some point in the future, but also, revenue streams do not equal operating profit. The next argument will be, "Well, Microsoft is a 3T (market cap) tech company that could buy up poor little Sony that's only worth 148B (market cap).

 

[Beechos]

Who cares about revenue?

That’s not how you “make” money

Yeah they did a lot of business, whoop de do, was any of it profitable?

For them probably. Don't forget they are 1st and foremost a software/service company and xbox is a tiny part of their overall finances, the data they gather from xbox users is prob worthwhile to them. Theres tons of companies out there that have never made a profit in their existence yet are some of the most valuable in the world.

 

[Mr Moose]

MS making $$$ and people here can’t handle it. LOL

You should make a thread about it.

 

[Killjoy-NL]

The gaming division is now the #1 games publisher. It takes some amazing mental gymnastics to think the #1 publisher isn't making a profit.

Unless papa Nadella keeps shoving money into a bottomless pit just to keep it around.

 

[ManaByte]

Unless papa Nadella keeps shoving money into a bottomless pit just to keep it around.

So you're saying the #1 games publisher in the world is not making a profit?

 

[Killjoy-NL]

So you're saying the #1 games publisher in the world is not making a profit?

Depends on the data. I don't have it, so it's hard to argue either way.

Though iirc, didn't the Xbox division have €400m operating loss after they acquired ABK?
Then I suppose it depends how much revenue they made last year and how much it cost them the run the division.

 

[Topher]

MS making $$$ and people here can’t handle it. LOL

This you?

Xbox has been killing it with 1st party titles in the last year but HW sales have gone down.
Sony had Concord and somehow it’s destroying Xbox in HW sales.

How is the even legal?

 

[pulicat]

Profit should be the gold standard for measuring any company's health. Microsoft should've not hide Xbox division profits details.

Playstation and Nintendo in the last 6 years

 

[Mr Moose]

Depends on the data. I don't have it, so it's hard to argue either way.

Though iirc, didn't the Xbox division have €400m operating loss after they acquired ABK?
Then I suppose it depends how much revenue they made last year and how much it cost them the run the division.

440M for one Q, in 3Q's it was about 1.2B loss if I remember correctly.
Edit: It was 1.36B loss.
440, 350, 570.

 

[fallingdove]

So you're saying the #1 games publisher in the world is not making a profit?

If they are loosing money on hardware, if they haven’t recouped their investments, if GamePass costs more to run than it is making, if actual game sales have eroded, of course there is a scenario where they aren’t profitable.

 

[pulicat]

The world isn't ready for Nintendo profits with Switch 2 on the market.

 

[cebri.one]

Then, they can't even pay the Activision adquisition with all the revenue generated in 5 years lmao.

 

[EN250]

Be thankful they didn't count all AMD shipments as Xbox since everything is an Xbox now

 

[twilo99]

How much did the Activision Blizzard acquisiton cost?

They make that cash back in approximately one fiscal year so really it sounds like an enormous amount but even if that asset went to zero they will be very much okay.

Is what they bought worth 80 big today? Probably not but it’s certainly not worth zero dollars…

 

[Hudo]

Unless papa Nadella keeps shoving money into a bottomless pit just to keep it around.

To be fair, Microsoft has so much money that shoveling billions into Xbox isn't gonna significantly impact their bottom line.

 

[poppabk]

Now let's see Microsoft's profits. Oh wait, they don't release them specifically for gaming. Funny, that.

The shitty Xbox sales pretty much guarantee this is the most profitable generation for them.

 

[nowhat]

The shitty Xbox sales pretty much guarantee this is the most profitable generation for them.

Maybe? So why not release the numbers then?

 

[poppabk]

Maybe? So why not release the numbers then?

Because they don't have to. If they have some extra special result I'm sure they will release something outside of the earnings, but the earnings reports are always going to be structured to provide focus to the segments that are driving the company - which isn't ever going to be gaming.

 

[thismeinteil]

To be fair, Microsoft has so much money that shoveling billions into Xbox isn't gonna significantly impact their bottom line.

Apparently MS doesn't believe that, otherwise they wouldn't be shipping their games onto PlayStation, killing any reason to buy their HW.

 

[nowhat]

Because they don't have to. If they have some extra special result I'm sure they will release something outside of the earnings, but the earnings reports are always going to be structured to provide focus to the segments that are driving the company - which isn't ever going to be gaming.

MS used to release sales figures of consoles about up until the second year of One. Never since. But they used to do that. Wonder what changed?

 

[Katatonic]

It's crazy to think that what we thought were fans of a gaming system have been conditioned into fans of a corporate entity.

 

[poppabk]

MS used to release sales figures of consoles about up until the second year of One. Never since. But they used to do that. Wonder what changed?

Because the sales became meh at best.

 

[thicc_girls_are_teh_best]

This is one of Derek's worst articles, and I thought he was learning to not baby Xbox so much during some of his ABK acquisition takes (among Xbox-friendly press, he was one of the more sane people). The title is completely misleading because it implies the consoles themselves have contributed this amount, when we know from all valid sources hardware sales are on a death bed, even in America.

Also it confuses revenue with net profit; not even gross profit, but net profit. Or at least it's ambiguously worded in the title to a point where a casual reader implies such. This misinforms yet another person online, who taints discussions around the platform by citing inaccurate information. And, since that person likely already has a bias towards the platform, they just reconfirm it with erroneous information, indoctrinating them and making it that much harder for them to learn the truth.

All in all, hilariously misworded article. Approaches peak glazing territory.

 

[nowhat]

Because the sales became meh at best.

But surely the terrific (software/subscription) sales would have been something to write home about. Instead we get some arbitrary metrics like "MAU". It's pretty blatantly obvious the MS gaming division is bleeding money.

 

[poppabk]

But surely the terrific (software/subscription) sales would have been something to write home about. Instead we get some arbitrary metrics like "MAU". It's pretty blatantly obvious the MS gaming division is bleeding money.

When was the last time they reported profit for the gaming division?
They would have to be working real hard to not be making a profit with the hardware dying and not sucking up cash.

 

[Hudo]

Apparently MS doesn't believe that, otherwise they wouldn't be shipping their games onto PlayStation, killing any reason to buy their HW.

I mean, of course they want to maximize profits. That's only natural.

 

[nowhat]

When was the last time they reported profit for the gaming division?

Around the time they reported Xbox sales. Now it's all revenue.

Let's put this another way. If they were making a profit, with all the acquisitions and push for a subscription, they surely would be shouting it from the rooftops? Yet, they don't do so. Which leads me to conclude, they are not making money. Revenue, sure. But living off purely revenue may be suitable for a startup, not a listed company.

 

[Jigsaah]

Netflix was a net loser for a long time. I think they only became profitable in recent years...maybe Covid affect...not sure. Either way, the math here is really easy, Xbox spent 80 billion just within the past couple of years with buying ABK...add another 7 billion for Bethesda...that means Microsoft is easily in the hole. That being said...63 billion for content and services is nothing to sneeze at and should they continue to trend upward in this category while also minimizing future costs, they could become profitable again by end of next generation...just spitballin' it. No shit they're putting their games everywhere. They have to.

I'd be on the street corner slangin' Halo too.

 

[Topher]

Netflix was a net loser for a long time. I think they only became profitable in recent years...maybe Covid affect...not sure. Either way, the math here is really easy, Xbox spent 80 billion just within the past couple of years with buying ABK...add another 7 billion for Bethesda...that means Microsoft is easily in the hole. That being said...63 billion for content and services is nothing to sneeze at and should they continue to trend upward in this category while also minimizing future costs, they could become profitable again by end of next generation...just spitballin' it. No shit they're putting their games everywhere. They have to.

I'd be on the street corner slangin' Halo too.

Acquisitions do not put a company in the hole (unless they have to borrow the money). It is a change of assets. If I buy a beach house for $1 million cash then I'm not $1 million "in the hole". My assets are just less liquid. If I rent out that beach house then the question is what is my ROI. The same is true for corporations.

 

[nowhat]

I'd be on the street corner slangin' Halo too.

 

[Woopah]

I don’t need to, you claimed it didn’t make a profit so I’m waiting for the receipts on that statement.

So you believe the xbox division costs more than $22BILLION a year to run?

It's not just about costs. That 22 billion includes third party digital revenue, 70% of which doesn't stay with Microsoft.

440M for one Q, in 3Q's it was about 1.2B loss if I remember correctly.
Edit: It was 1.36B loss.
440, 350, 570.

That was a cost related to ABK specifically right? I don't believe MS gives profit figures for its individual sectors.

 

[PharaoTutAnchAmun]

I don’t need to, you claimed it didn’t make a profit so I’m waiting for the receipts on that statement.

So you believe the xbox division costs more than $22BILLION a year to run?

So you cant give an answer mister economist, got you

 

[thismeinteil]

I mean, of course they want to maximize profits. That's only natural.

It's a little more impactful then just maximizing profit. They're announcing they're done losing money on Xbox, so the argument that it's just chump change to MS and they could do it forever and not care doesn't hold water. They're also admitting defeat in the HW biz.