Microsoft Sees Xbox Hardware Revenue Drop 29 Percent

From PC Mag: Late last week, Microsoft revealed it FY17 Q4 results, ending June 30, 2017. For the gaming division specifically, there's both good and bad news, and some clear feedback for Microsoft regarding how it handles gaming hardware announcements and launches.

Let's start with the good news. Overall, gaming revenue increased by three percent, which translates to an extra $44 million. That was due to an 11 percent increase in revenue from software and service sales. In particular, Xbox Live transactions increased significantly. So Microsoft is selling lots of games for the Xbox One, and in particular digital games.

The bad news comes in the form of hardware sales. Xbox hardware revenue dropped by 29 percent. Microsoft states some of that is due to lower hardware pricing, but it is also selling fewer consoles. So while software sales may be strong right now, future sales can't be as strong is fewer people are buying the hardware to play them on.

No explanation is given for lower hardware sales, but it's not hard to guess why. Gamers are always less inclined to pick up new hardware when they know a replacement is coming soon. Microsoft decided to announce the Xbox One X$499.00 at Microsoft months before it was set to launch, and has since touted just how powerful it is compared to everything else on the market. With that in mind, why buy an Xbox One S$309.99 at Amazon now when the Xbox One X launches on November 7?

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