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This is for the running quarter or until March 31st?
Headlines
Xbox + Microsoft FY23 Q3 Results: Total Gaming -4% ($3.607B), Content & Services +3% (Game Pass growth), Hardware -30% | Subs Nearly $1B
- Thread starter Welfare
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- Financial Results
New Minecraft + Diablo IV.
Ghostwire won't do anything and Arkane games don't push big numbers. Diablo IV and Minecraft Legends will do the heavy lifting.
OP
OP
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April to June guidance
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Surely Microsoft wouldn't include Diablo IV in their forecasts, they don't own Activision yet. Unless people are just meaning their split of the xbox sales, but I can't imagine that would make much of a difference in any quarterly results.
I also can't see Minecraft Legends posting any big numbers, it doesn't seem to have sold that well and isn't any good either so will be lacking legs.
I also can't see Minecraft Legends posting any big numbers, it doesn't seem to have sold that well and isn't any good either so will be lacking legs.
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Diablo 4 would be treated as a third party game. It's the biggest not first party (as of now) they have.
This is probably the least likely scenario possible
Btw, good to see Gamepass grow despite hardware struggles
That service is gold for consumers
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Sure that's what I thought. I suppose last year Apr-Jun was lacking in big game releases so improved sub revenue plus the small chunks from Minecraft Legends, Redfall and their share of D4, Jedi Survivor, SF6 will drive the growth.
I think Redfall is going to do much better than people are expecting. I agree with the other three.
I told you guys that Microsoft would report additional Gaming declines today.
Redfall is on GP, so won’t directly push revenue. Diablo IV, Star Wars will do big numbers this quarter and Minecraft will do big numbers across multiple platforms.
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Their core businesses smashed expectations.
I like Phil a lot but his big thing seems gamepass and I've always had misgivings about that. Too be fair, we cant say the whole story is written either. Just so far it seems to have little or no positive impact on console hardware share. I just have misgivings if the model is suited for the core console market.
The other big issue I have with MS strat this gen is Series S. Which I can also sort of give a pass on because IMO it takes extremely 3d-chess order of thinking to understand how it doesnt work. It's not at all obvious. It was one of those things that you can see might have been worth a try. I dont think anyone will ever do it again.
Anyways overall seems like a mediocre but not disastrous quarter for xbox. Not disastrous is arguably kind of positive for Xbox right now! Need to refocus on the X and get that stock up. Every store should have stacks of X. And 399 X DE with potential to get aggressive to 349.
Yes but is this just in dollars? Anything not in some inflation resistant metric is going to be a little useless as far as new highs in this day and age.
I'm vaguely assuming they build in inflation protection in these reports (constant currency?) but I'd also suspect it's quite soft and much like govt CPI may not come close to capturing real inflation.
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There is no such thing as an "inflation resistant" metric.
Well I dont know you could debate it but something like "little black plastic boxes sold" would be an example (I know Ms is not going to give us that). Or you could get into MAU's and such also, provided they dont soften those definitions internally etc. Or just adjusting by CPI would be a start (not sure how realistic that would be). Point is "4th best revenue Xbox quarter" or whatever, doesnt really tell me much, as "4th most plastic boxes sold" or "4th most human beings engaged with Xbox".
I get your point, nothing is going to be perfect. but you should also get mine.
I've often kind of thought given a increasing population worldwide with monetary resources, the core console market should grow much more than it has, but thats another discussion.
I think Xbox could be performing better considering the resources given to Phil. After such a big outlay for the Xbox division, all eyes will be on him.
Phil Spencer became head of Xbox in 2014 with Xbox One being spanked by PS4 and very few first party studios.
I think the guy did what he could to in first place keep Xbox alive, since Nadella considered to shut down, and expand the ecosystem launching all first party on PC, investments in cloud gaming and gamepass were interesting strategies and drove revenue at record levels.
For this generation first party studios were massively increased, but they aren't providing games at the necessary pace. Even considering the chalenges of the pandemic, it seems there's a management problem in Xbox studios and the guy that should respond for that is Matt Booty, but ultimately as the head Phil Spencer has responsibility too.
I still have Phil Spencer in high consideration, but now with Bethesda and likely soon ABK, there's no excuses if Xbox as a business (not just the console) don't grow significantly.
I think the guy did what he could to in first place keep Xbox alive, since Nadella considered to shut down, and expand the ecosystem launching all first party on PC, investments in cloud gaming and gamepass were interesting strategies and drove revenue at record levels.
For this generation first party studios were massively increased, but they aren't providing games at the necessary pace. Even considering the chalenges of the pandemic, it seems there's a management problem in Xbox studios and the guy that should respond for that is Matt Booty, but ultimately as the head Phil Spencer has responsibility too.
I still have Phil Spencer in high consideration, but now with Bethesda and likely soon ABK, there's no excuses if Xbox as a business (not just the console) don't grow significantly.
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Microsoft ultimately need a reliable development pipeline. There will be delays but you can’t really just release Halo and Forza every few years. Their acquisitions will help with this but they can’t have these multi year droughts.
It will be interesting how they perform once Bethesda start releasing more and their Acti buy kicks in but I still thinks it’s difficult for them.
It will be interesting how they perform once Bethesda start releasing more and their Acti buy kicks in but I still thinks it’s difficult for them.
With all the studios in their posession they should be able to release at the very least two AAA games per year and maybe two smaller games per year. If their ABK merger gets approved (wakey wakey, CMA) they're also gonna have several very successful live-service games running. Future looks bright imo.
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- -30% on hardware revenue is even worse than XB1 and its hugely off to what their direct competition is doing
- Even +3% C&S is not good, compared to XB1 in YoY % changes or their competition. However C&S is very dependent on release schedule, this Q3 and last Q3 had some big releases.
- Forecast of 11-16% growth in C&S is mostly from this year having bigger releases (RE4, Star Wars, Diablo 4, SF6)
- The hardware forecasted next Q is -24% to -32%
| Calendar Qs | XBS C&S % | XB1 C&S % | PS5 C&S % | XBS Hardware | XB1 hardware | PS5 hardware |
| 2nd Year Q3 | -3 | +14 | +9.8 | +15 | -17 | +11.6 |
| 2nd Year Q4 | -12 | +29 | +28.2 | -13 | -9 | +118 |
| 3rd Year Q1 | +3 | +17 | +35* | -30 | -26 | +240* |
| 3rd Year Q2* | +11 to +16 | +1 | -24 to -32 | -33 |
Next FY, their Hardware sales are either up YoY low double digit at least, or Xbox is in serious trouble.
Does not matter if supply or demand side will be the issue. Has to be up YoY.
This FY had no good quarter.
Q1 started strong, but got worse every month as pointed out by @Welfare
Holiday were modest, or even bad if you consider the price drop.
This and next quarter supply issues.
Or Microsoft hast to come out and say Xbox console is just there to meet some baseline demand and not grow the market or their share. That's for software only. If they run the business that way, just acknowledge it. If they do not run the business that way, they do fail running it properly.
Does not matter if supply or demand side will be the issue. Has to be up YoY.
This FY had no good quarter.
Q1 started strong, but got worse every month as pointed out by @Welfare
Holiday were modest, or even bad if you consider the price drop.
This and next quarter supply issues.
Or Microsoft hast to come out and say Xbox console is just there to meet some baseline demand and not grow the market or their share. That's for software only. If they run the business that way, just acknowledge it. If they do not run the business that way, they do fail running it properly.
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Yes, EPS 9.67% above expected. Stock up 7.65% pre-market currently.
Yeah, not surprising. Funny that the prior quarter was the complete opposite.
Xbox One ($399)
Q1 2Y16 - $738M
Q2 2Y16 - $1.97B
Q3 2Y16 - $401M
Q4 2Y16 - $335M
Q1-3 = $3.109B
Xbox Series ($300-500)
Q1 2Y23 - $813M
Q2 2Y23 - $1.371B
Q3 2Y23 - $501M
Q4 2Y23 - ?
Q1-3 = $2.685B
Data of our dear Welfare
Looks bad but the bottom line is that Microsoft's gaming division now made 3.6 billion dollars, compared to the 1.6 billion it made in Xbox One's 3YQ1. That's a 125% increase in revenue and probably the more important number to the company and the shareholders.
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Should be almost 6.0 billion dollars for FYQ3 2024, after the merger is done.
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Microsoft / Activision deal prevented to protect innovation and choice in cloud gaming
The CMA has prevented Microsoft’s proposed purchase of Activision over concerns the deal would alter the future of the fast-growing cloud gaming market, leading to reduced innovation and less choice for UK gamers over the years to come.
Prevented
ATVI stock tanking in pre-market. 77 right now
