Microsoft reported a 166% increase in revenue from Xbox consoles in the company’s first fiscal quarter, which ended September 30. The rise reflects stronger sales of both Xbox One units and the newer Xbox Series X|S consoles, the company said.
Console demand outpaced supply, says CFO
The 166% figure compares the quarter to the same three months a year earlier, when Xbox One sales had declined ahead of the Series X|S launch. Microsoft Chief Financial Officer Amy Hood said the company sold “more Xbox Series X|S consoles than expected, even with demand continuing to exceed supply.”
Gaming segment performance and Game Pass
Overall gaming revenue grew 16% year over year. However, revenue from Xbox content and services rose only 2%, reflecting a slowdown in new game releases from third parties and a smaller-than-expected increase in Xbox Game Pass subscriptions.
Microsoft attributed the lighter slate of new releases mainly to development delays caused by the COVID-19 pandemic. The company did not provide a breakdown of which specific figures declined.
Company-wide results driven by cloud
Across Microsoft, total revenue rose 22% versus the prior year to $45.3 billion for the quarter. The company said its cloud business was a primary driver, growing 36%.
The More Personal Computing segment, which includes Xbox consoles, generated $13.3 billion in revenue, an increase of 12% from the year-ago quarter.
Profit and expenses
Microsoft’s net income increased 48% to $20.5 billion, while operating income climbed 27% to $20.2 billion. Operating expenses grew 15%, a rise Microsoft linked primarily to the acquisition of ZeniMax, a group of video game companies.
