14 DAY TRIAL // Microsoft just reported on its Q3 fiscal year 2015 earnings, showing a significant growth in Xbox Live usage, but an overall decline in console unit sales for the quarter.
The company revealed a 30 percent growth in the Xbox Live service, which is attributed to an increased user base and deeper user engagement. The total number of Xbox Live users has grown by an impressive 18 percent during the quarter.
Xbox Live and other store transaction revenue is on the rise, with a total increase of 32 percent year-over-year, and first-party video game revenue is also performing well, mainly due to the recently acquired Minecraft.
The company also reported a 25 percent increase in store transaction revenue, driven by an increased number of users and an increase in revenue per user, translating into a 25 percent improvement.
However, the overall Xbox platform revenue noticed a 24 percent year-on-year drop overall, due to the lower volume of Xbox One consoles sold compared to last year's numbers, and to the lower price of the unit, related to numerous promotional offers that the company utilized in order to drive sales.
Microsoft revealed that it managed to move a number of 1.6 million Xbox consoles during the third quarter of fiscal year 2015, a pretty bad performance, compared to last year's 2 million.
Microsoft is still lagging behind Sony when it comes to console sales
However, for the period of nine months that ended on March 31, the company reported an increase of 6 percent in its Computing and Gaming Hardware division, with the solid performance of the Surface line offsetting the poor performance of the Xbox platform.
However, there have been some improvements, such as the lower cost per console sold, decreasing the Xbox's cost of revenue, and translating into a solid 55 percent increase in gross margin.
Microsoft's Xbox division reported a decrease of 8 percent in revenue when compared to its performance during FY2014, and an overall decrease in second and third-party video games revenue, offsetting the performance of first-party efforts and Minecraft.
The software and hardware giant reported that it had sold 10.7 million Xbox 360 and Xbox One consoles during the first three quarters of the fiscal year, which translates into an increase of 100k units year-on-year.
Another factor which the company cites as a reason for the decline in revenue is the unfavorable foreign currency impact.