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[GHG]

Lmao... This thread is hilarious.

Warrior on Twitter number 1 - AKA the Washington post

Warrior on Twitter 2 - AKA VG247 referencing the financial times

Anyone who follows financial news on tech companies knows it's no secret that there are certain MSFT investors who, at various points in time, have suggested it's time for Microsoft to wind down or sell off the Xbox division (namely Paul Ghaffari of Vulcan Capital, and ValueAct after they gained a seat on the board). This was especially prominent during the period of time when Xbox was at its lowest point after the Xbox One reveal but these sorts of calls have died down since they have managed to turn the division around by cutting costs and focusing on profitability.

But all of this must be #FakeNews and I'm the ringleader of Twitter warriors.

 

[Ushay]

Warrior on Twitter number 1 - AKA the Washington post

Warrior on Twitter 2 - AKA VG247 referencing the financial times

Anyone who follows financial news on tech companies knows it's no secret that there are certain MSFT investors who, at various points in time, have suggested it's time for Microsoft to wind down or sell off the Xbox division (namely Paul Ghaffari of Vulcan Capital, and ValueAct after they gained a seat on the board). This was especially prominent during the period of time when Xbox was at its lowest point after the Xbox One reveal but these sorts of calls have died down since they have managed to turn the division around by cutting costs and focusing on profitability.

But all of this must be #FakeNews and I'm the ringleader of Twitter warriors.

Those articles are cringe worthy, sound a lot like GAF sometimes to be honest.

 

[GHG]

Those articles are cringe worthy, sound a lot like GAF sometimes to be honest.

Jesus Christ.

The search business and even Xbox, which has been a very successful product, are detracting from that,” Allen’s investment partner Paul Ghaffari stated. “We would want them to focus on their best competencies

“My view is there are some parts of that operation they should probably spin out, get rid of, to focus on the enterprise and focus on the cloud.”

The cringe. The GAFness.

 

[Chobel]

Those articles are cringe worthy, sound a lot like GAF sometimes to be honest.

Huh?

 

[leeh]

Jesus Christ.



The cringe. The GAFness.

Both articles were in '13/'14. Both investors were short sighted in how consumer products leveraging the cloud would bring their platforms more into the mindsets of businesses as well.

I wonder why someone hasn't talked about it since? Cause they see that now.

 

[Prototype Viktor]

Both articles were in '13/'14. Both investors were short sighted in how consumer products leveraging the cloud would bring their platforms more into the mindsets of businesses as well.

I wonder why someone hasn't talked about it since? Cause they see that now.

or they were trying to get MS to dump their mobile platforms as it was bleeding money. then went on to something else

 

[oti]

Relax man, we know Sony's gaming division is likely making more money and selling more consoles than Xbox. I don't know why you're so up in a tizzy. The world isn't gonna end tomorrow, Sony is still the leader don't get your knickers in a twist

I'm also not sure who you're talking to with your "defending a company like this" comment because I literally never defended MS at all, infact, I haven't even said anything specifically relating to the topic at hand let alone "defend" them over something. Unless you think calling out fanboys who shitpost in every xbox thread no matter what it's about is defending MS?

Also to the bolded, yeah, that's what happens. You discount a price, you do typically make less revenue off that product. I don't know why this is such a shock to you.

I see. You either didn't even read the report or don't grasp fundamental economics. OK then. Not wasting my time any longer.

 

[nekkid]

The cringe. The GAFness.

Just talking about that quote in particular, I believe that is a bit shortsighted (the one you quoted, not your post - just to clarify).

Whilst their focus on cloud and enterprise is their primary business now, things like Xbox and Minecraft help to build the relevance of MS with the young people who will eventually be the customers of their enterprise and cloud offerings.

Gaming tech in non-gaming industry also has less of the stigma, these days. Things like the Azure advert that used Titanfall, as an example.

 

[leeh]

I see. You either didn't even read the report or don't grasp fundamental economics. OK then. Not wasting my time any longer.

Obviously you didn't either as their revenue has risen 3% YoY to achieve 1.6bn, yet "they've seen better days".

In reality, they've never been better as they've got healthy/steady growth.

 

[Bits N Pieces]

Warrior on Twitter number 1 - AKA the Washington post

Warrior on Twitter 2 - AKA VG247 referencing the financial times

Anyone who follows financial news on tech companies knows it's no secret that there are certain MSFT investors who, at various points in time, have suggested it's time for Microsoft to wind down or sell off the Xbox division (namely Paul Ghaffari of Vulcan Capital, and ValueAct after they gained a seat on the board). This was especially prominent during the period of time when Xbox was at its lowest point after the Xbox One reveal but these sorts of calls have died down since they have managed to turn the division around by cutting costs and focusing on profitability.

But all of this must be #FakeNews and I'm the ringleader of Twitter warriors.

They are both years and years old? Whats the relevancy? I could post old articles about Sony getting out the business or why Nintendo should go third party but whats the point?

 

[Christocolus]

Warrior on Twitter number 1 - AKA the Washington post

Warrior on Twitter 2 - AKA VG247 referencing the financial times

Anyone who follows financial news on tech companies knows it's no secret that there are certain MSFT investors who, at various points in time, have suggested it's time for Microsoft to wind down or sell off the Xbox division (namely Paul Ghaffari of Vulcan Capital, and ValueAct after they gained a seat on the board). This was especially prominent during the period of time when Xbox was at its lowest point after the Xbox One reveal but these sorts of calls have died down since they have managed to turn the division around by cutting costs and focusing on profitability.

But all of this must be #FakeNews and I'm the ringleader of Twitter warriors.

Lol. What is this about? Anways your links prove nothing bro. Those articles are old and nobody is talking about that anymore..right now MS gaming division is doing well and that's what matters. I wonder why others are bothered though.
This thread is hilarious...

 

[notaskwid]

Obviously you didn't either as their revenue has risen 3% YoY to achieve 1.6bn, yet "they've seen better days".

In reality, they've never been better as they've got healthy/steady growth.

But what about the profit?

 

[TheThreadsThatBindUs]

Obviously you didn't either as their revenue has risen 3% YoY to achieve 1.6bn, yet "they've seen better days".

In reality, they've never been better as they've got healthy/steady growth.

You know very well that a 3% rise in revenue YOY without any qualification doesn't give the full picture. So it's entirely naive to take that figure and try to paint a picture that everything is rosy at MS's Xbox gaming division.

For all we know, that 3% increase in revenue could be coming entirely from Minecraft sales (which is platform agnostic), meaning no growth in revenue from Xbox, despite a larger console userbase. That wouldn't paint a picture of an optimistic outlook for Xbox at all.

Fact is, the qualifying information provided, i.e. a real fall in console unit sales as well as revenue per unit, isn't a good thing for Xbox at all; especially in light of the fact that their other two competitors in the industry are breaking sales records. So if the industry as a whole is booming (as evidenced by Sony and Nintendo's performance) why isn't MS enjoying similar unambiguous success?

 

[GHG]

Both articles were in '13/'14. Both investors were short sighted in how consumer products leveraging the cloud would bring their platforms more into the mindsets of businesses as well.

I wonder why someone hasn't talked about it since? Cause they see that now.

I'm fully aware of the dates and my post actually references that fact. But yes, there is a high degree of short sightedness in what they say. But we have to remember that at that time a lot of R&D and marketing money had been spent on the Xbox One reveal and it was yielding terrible pre-order numbers along with an overall negative response across much of the gaming community. From an investors point of view who is only interested in profits the main question becomes "is all of this worth it". Investors rarely care about long term plans, they want to see returns ASAP, even if that means gutting a business in order to do so.

They are both years and years old? Whats the relevancy? I could post old articles about Sony getting out the business or why Nintendo should go third party but whats the point?

Lol. What is this about? Anways your links prove nothing bro. Those articles are old and nobody is talking about that anymore..right now MS gaming division is doing well and that's what matters. I wonder why others are bothered though.
This thread is hilarious...

Oh I see the jimmies have been rustled. Some of you are awfully sensitive aren't you? The timeframe is addressed in the very post you are quoting. Just because calls for the division to be sold/shut down aren't happening now, it doesn't mean they never did.

This is where it started:

So is the Xbox division profitable now? Tons of inverstors were calling for Microsoft to abandon the Xbox just a couple of years ago. Glad they didn't.

I've bolded the keyword for you there.

There were not "tons" but there were individuals on the board who thought this way.

 

[MilkyJoe]

F*cking 'ell....

 

[Bits N Pieces]

I'm fully aware of the dates and my post actually references that fact. But yes, there is a high degree of short sightedness in what they say. But we have to remember that at that time a lot of R&D and marketing money had been spent on the Xbox One reveal and it was yielding terrible pre-order numbers along with an overall negative response across much of the gaming community. From an investors point of view who is only interested in profits the main question becomes "is all of this worth it". Investors rarely care about long term plans, they want to see returns ASAP, even if that means gutting a business in order to do so.





Oh I see the jimmies have been rustled. Some of you are awfully sensitive aren't you? The timeframe is addressed in the very post you are quoting. Just because calls for the division to be sold/shut down aren't happening now, it doesn't mean they never did.

So to question someone's post on a forum shows that I am either harrassing someone or my jimmies have been rustled, going by this thread? lol

You're an absolute keeper, please continue

 

[GHG]

So to question someone's post on a forum shows that I am either harrassing someone or my jimmies have been rustled, going by this thread? lol

You're an absolute keeper, please continue

Excuse me?

And no, I have no issue with you questioning a post of mine but it makes little sense to me when the answers to your questions exist in the very post you are quoting along with the context of the discussion it is taking place in.

 

[Bits N Pieces]

Excuse me?

And no, I have no issue with you questioning a post of mine but it makes little sense to me when the answers to your questions exist in the very post you are quoting along with the context of the discussion it is taking place in.

Someone said Matt was being harassed becasue of me questioning a few of his posts and now my jimmies are rustled because I questioned your post.

And I get that there will be people who say that MS should spin off the Xbox division, I mean that chat has being going on for as long as they got into the console gaming industry all the way back. I just dont think it carries any weight or impact when you see gaking becoming a revenue driver and focus from Satya down.

 

[leeh]

But what about the profit?

If I recall on their yearly financials they report on their margins and it was around 40% for the division.

You know very well that a 3% rise in revenue YOY without any qualification doesn't give the full picture. So it's entirely naive to take that figure and try to paint a picture that everything is rosy at MS's Xbox gaming division.

For all we know, that 3% increase in revenue could be coming entirely from Minecraft sales (which is platform agnostic), meaning no growth in revenue from Xbox, despite a larger console userbase. That wouldn't paint a picture of an optimistic outlook for Xbox at all.

Fact is, the qualifying information provided, i.e. a real fall in console unit sales as well as revenue per unit, isn't a good thing for Xbox at all; especially in light of the fact that their other two competitors in the industry are breaking sales records. So if the industry as a whole is booming (as evidenced by Sony and Nintendo's performance) why isn't MS enjoying similar unambiguous success?

There is a qualification, its due to the 11% increase in store transactions, which their entire business model works around. That's successful. Bottom line is, any business seeing healthy and steady growth YoY is successful. You can try and pull it apart to make it look bad, but their Xbox division barely relies on hardware units sold as they barely make any money on them. They make their money on software royalties.

 

[GHG]

Someone said Matt was being harassed becasue of me questioning a few of his posts and now my jimmies are rustled because I questioned your post.

And I get that there will be people who say that MS should spin off the Xbox division, I mean that chat has being going on for as long as they got into the console gaming industry all the way back. I just dont think it carries any weight or impact when you see gaking becoming a revenue driver and focus from Satya down.

Of course it carries weight. Sataya serves the BoD and if there arose a scenario where majority of the board members wanted to come up with a strategy where by the Xbox division is wound down or sold off then it would have to happen. But as it stands, it's not the majority of the board members who have held this view at any given point in time (nor has it ever been) but what they did end up agreeing upon was a restructuring of the division along with a new focus for profitability.

Its a discussion worth having because if they had continued being unprofitable then there would have been a risk that the board members who wanted to get rid of it could have influenced other board members toward their way of thinking. It's a completely different situation to other players in the console market because for Microsoft, Xbox is just one of their many pillars whereas for the others (Nintendo in particular) gaming is their only pillar.

So dismissing somebody in this thread who says "thank god that never happened" by then saying "it was only fanboys on Twitter making stuff up anyway" is an awfully reductive view to take on it, never mind the fact that it's far from the truth.

So while there have been people in this thread dismissing the fact that gaming revenue is increasing for Microsoft at the moment, it's actually of paramount importance that it continues to be the case for the Xbox division due to what has gone on at board level since the Xbox One was revealed.

 

[Christocolus]

I'm fully aware of the dates and my post actually references that fact. But yes, there is a high degree of short sightedness in what they say. But we have to remember that at that time a lot of R&D and marketing money had been spent on the Xbox One reveal and it was yielding terrible pre-order numbers along with an overall negative response across much of the gaming community. From an investors point of view who is only interested in profits the main question becomes "is all of this worth it". Investors rarely care about long term plans, they want to see returns ASAP, even if that means gutting a business in order to do so.





Oh I see the jimmies have been rustled. Some of you are awfully sensitive aren't you? The timeframe is addressed in the very post you are quoting. Just because calls for the division to be sold/shut down aren't happening now, it doesn't mean they never did.

This is where it started:



I've bolded the keyword for you there.

There were not "tons" but there were individuals on the board who thought this way.

This thread...lol. It's ok man. I wasn't even calling you out. I'm just glad MS gaming division is doing ok now.

 

[Bits N Pieces]

Of course it carries weight. Sataya serves the BoD and if there arose a scenario where majority of the board members wanted to come up with a strategy where by the Xbox division is wound down or sold off then it would have to happen. But as it stands, it's not the majority of the board members who have held this view at any given point in time (nor has it ever been) but what they did end up agreeing upon was a restructuring of the division along with a new focus for profitability.

Its a discussion worth having because if they had continued being unprofitable then there would have been a risk that the board members who wanted to get rid of it could have influenced other board members toward their way of thinking. It's a completely different situation to other players in the console market because for Microsoft Xbox is just one of their many pillars whereas for the others (Nintendo in particular) gaming is their only pillar.

So dismissing somebody in this thread who says "thank god that never happened" by then saying "it was only fanboys on Twitter making stuff up anyway" is an awfully reductive view to take on it, never mind the fact that it's far from the truth.

So while there have been people in this thread dismissing the fact that gaming revenue is increasing for Microsoft at the moment, it's actually of paramount importance that it continues to be the case for the Xbox division due to what has gone on at board level since the Xbox One was revealed.

I dont disagree with any of that

 

[nephilimdj]

3rd party licence and digital profits are just crazy as more and more turn digital, Nintendo really missing out on those 100s of millions that games like GTAV, Destiny and COD bring in

 

[leeh]

I'm fully aware of the dates and my post actually references that fact. But yes, there is a high degree of short sightedness in what they say. But we have to remember that at that time a lot of R&D and marketing money had been spent on the Xbox One reveal and it was yielding terrible pre-order numbers along with an overall negative response across much of the gaming community. From an investors point of view who is only interested in profits the main question becomes "is all of this worth it". Investors rarely care about long term plans, they want to see returns ASAP, even if that means gutting a business in order to do so.

Your definition of a typical investor couldn't be more the opposite. They mostly care about long-term strategy, especially shares like MS with dividends, its all about the squeezing every penny from the consumer by monetizing them in the best way possible. That doesn't mean selling loads of consoles with tiny to no margin. That does mean using a long-term strategy of building a healthy eco-system to take your share in royalties fee's on digital goods which cost you next to nothing in comparison.

Something that both MS (evident by 11% store revenue increase) and Sony seem to be doing excellently at these generations. They're both not dumb.

 

[gamz]

I don't think investors are questioning anything when MS stock has just about doubled since Satya took over. Xbox is making more money this gen then in previous gen. People need to chill here.

 

[Bluth54]

3rd party licence and digital profits are just crazy as more and more turn digital, Nintendo really missing out on those 100s of millions that games like GTAV, Destiny and COD bring in

Not just those big third party games, but the fact the Switch only has 26 GB of user accessible flash memory means that more people will probably buy more physical games so they don't have to buy a large microSD card. I'm fairly sure the standard license fee for a physical game is smaller than the 30% cut they make off the eshop but someone please correct me if I'm wrong.

 

[therealbigrich]

Seemingly the only way to figure out what's really going on with Xbox for MS to give out profit numbers. No way to do that anyway you slice it so we have no way to truly really no what's going on

 

[leeh]

I don't think investors are questioning anything when MS stock has just about doubled since Satya took over. Xbox is making more money this gen then in previous gen. People need to chill here.

Simple yet effective. Stock price says all.

Should of trusted my gut and invested in them personally back then, I knew they'd see a nice rise.

 

[gamz]

Not just those big third party games, but the fact the Switch only has 26 GB of user accessible flash memory means that more people will probably buy more physical games so they don't have to buy a large microSD card. I'm fairly sure the standard license fee for a physical game is smaller than the 30% cut they make off the eshop but someone please correct me if I'm wrong.

Pretty sure Nintendo is making much more on hardware. But, yeah, they aren't maximizing the digital side of things.

 

[gamz]

Simple yet effective. Stock price says all.

Should of trusted my gut and invested in them personally back then, I knew they'd see a nice rise.

No shit. I owned Amazon stock 15 years ago and sold it because my buddy who works in financial said too. Never listened to that idiot again.

In short, always bet on a CEO with a solid vision. Blah!

 

[The Pet of the Month]

Pretty sure Nintendo is making much more on hardware. But, yeah, they aren't maximizing the digital side of things.

I should've invested in EA stock when I had the chance, never knew they'd recovery so quickly!

Life regrets 🙁

 

[AmFreak]

Obviously you didn't either as their revenue has risen 3% YoY to achieve 1.6bn, yet "they've seen better days".

In reality, they've never been better as they've got healthy/steady growth.

3% YoY in the growing phase of a console is not a healthy/steady grow, especially if you are already on such a low level.

 

[leeh]

No shit. I owned Amazon stock 15 years ago and sold it because my buddy who works in financial said too. Never listened to that idiot again.

In short, always bet on a CEO with a solid vision. Blah!

Ive just been reminded of when I've sold large chunks of my Bitcoin off twice when I could of made a shit ton more.

Live and learn I guess.

3% YoY in the growing phase of a console is not a healthy/steady grow, especially if you are already on such a low level.

When your division is that large and is already over a billion revenue earner, it definitely is. Why did their stock price continue their upwards trend after the quarterly report if these numbers are so bad?

What does when you're on such a low level even mean?

 

[gamz]

Reminds me of all the Bing jokes from years ago. All the years of losing money and now it has search share of 30 percent, is a billion dollar division and the backbone of their cloud and analytics. Guys Xbox is in a lull and still raking. No worries, honestly.

The infrastructure on digital and ecosystem has never been stronger. It's making billions and this is their lull? Lol.

Sony, MS, and Nintendo are just fine.

 

[nekkid]

Reminds me of all the Bing jokes from years ago. All the years of losing money and now it has search share of 30 percent, is a billion dollar division and the backbone of their cloud and analytics. Guys Xbox is in a lull and still raking. No worries, honestly.

Nobody uses Bing lololololol, etc.

 

[gamz]

Nobody uses Bing lololololol, etc.

Let's not dig up the MS buying Minecraft thread from two years ago. "Mojang has one game man!"

 

[TheThreadsThatBindUs]

There is a qualification, its due to the 11% increase in store transactions, which their entire business model works around. That's successful. Bottom line is, any business seeing healthy and steady growth YoY is successful. You can try and pull it apart to make it look bad, but their Xbox division barely relies on hardware units sold as they barely make any money on them. They make their money on software royalties.

11% increase in store transactions adds a little context, however, still tells us little about the health of their gaming business (e.g. those store transactions could be sales of media content). Also, why are you trying to redefine their business model just to argue that hardware sales aren't important? Seems like an illogical position to me.

Their Xbox business is a console business. If they don't sell consoles then they can't grow their software and royalty revenues. That's pretty clear. We're talking about the health of the Xbox as a platform and to have a healthy platform we should be seeing growth in unit sales of console hardware as well as software sales and royalty revenues. If we aren't, there should be cause for concern.

I don't understand why you insist on willfully ignoring this fact...

Clearly, their Xbox business isn't tanking. They're bringing in reasonably good revenue numbers, but the principal indicators of longer-term success for the platform (i.e. hardware unit sales) are lagging well behind their competitors in a evidently very healthy console gaming market.

When your division is that large and is already over a billion revenue earner, it definitely is. Why did their stock price continue their upwards trend after the quarterly report if these numbers are so bad?

Yes... because the stock price reflects only the performance of MS' gaming division. /s

You're being rather disingenuous here.

 

[gamz]

11% increase in store transactions adds a little context, however, still tells us little about the health of their gaming business (e.g. those store transactions could be sales of media content). Also, why are you trying to redefine their business model just to argue that hardware sales aren't important? Seems like an illogical position to me.

Their Xbox business is a console business. If they don't sell consoles then they can't grow their software and royalty revenues. That's pretty clear. We're talking about the health of the Xbox as a platform and to have a healthy platform we should be seeing growth in unit sales of console hardware as well as software sales and royalty revenues. If we aren't, there should be cause for concern.

I don't understand why you insist on willfully ignoring this fact...

Clearly, their Xbox business isn't tanking. They're bringing in reasonably good revenue numbers, but the principal indicators of longer-term success for the platform (i.e. hardware unit sales) are lagging well behind their competitors in a evidently very healthy console gaming market.



Yes... because the stock price reflects only the performance of MS' gaming division. /s

You're being rather disingenuous here.

New hardware is coming out in 4 months that effects current hardware. You'll see a spike in November.

 

[leeh]

11% increase in store transactions adds a little context, however, still tells us little about the health of their gaming business (e.g. those store transactions could be sales of media content). Also, why are you trying to redefine their business model just to argue that hardware sales aren't important? Seems like an illogical position to me.

Their Xbox business is a console business. If they don't sell consoles then they can't grow their software and royalty revenues. That's pretty clear. We're talking about the health of the Xbox as a platform and to have a healthy platform we should be seeing growth in unit sales of console hardware as well as software sales and royalty revenues. If we aren't, there should be cause for concern.

I don't understand why you insist on willfully ignoring this fact...

Clearly, their Xbox business isn't tanking. They're bringing in reasonably good revenue numbers, but the principal indicators of longer-term success for the platform (i.e. hardware unit sales) are lagging well behind their competitors in a evidently very healthy console gaming market.



Yes... because the stock price reflects only the performance of MS' gaming division. /s

You're being rather disingenuous here.

Your whole point falls down around you buy saying Xbox is a console business, its not, its a platform. That's why the reporting has been updated to reflect that. Yeah, hardware is a big chunk of it, but as long as the end-goal of store monetization is on the healthy rise, which it is, then its a good outlook.

I love people taking stuff out of context. If one of their billion dollar revenue divisions (Windows, Surface, Gaming, Office, Bing and Cloud) was performing poorly, the stock price would reflect it.

From the outlook of MSFT stock, its got a positive outlook and they've well passed their high of 1999 buy quite a margin.

You're just trying hard to spin this into a negative for Xbox. Just because the PS4 is performing excellently, doesn't mean the Xbox is performing shit.

Its like Apple vs Android. Android has way more market share than Apple by a huge margin, are Apple performing poorly? Nope.

 

[AmFreak]

Why did their stock price continue their upwards trend after the quarterly report if these numbers are so bad?

Are you serious?
Revenue up 13%, net profit doubled and you ask why their price is up, despite the One business, they obfuscate to hell and back, continuing not doing so well?

What does when you're on such a low level even mean?

Low level compared to their competitor aka Sony.
The gap is widening not closing, in absolute terms and with numbers like these very likely also in relative ones.

 

[PeterGAF]

Warrior on Twitter number 1 - AKA the Washington post

Warrior on Twitter 2 - AKA VG247 referencing the financial times

Anyone who follows financial news on tech companies knows it's no secret that there are certain MSFT investors who, at various points in time, have suggested it's time for Microsoft to wind down or sell off the Xbox division (namely Paul Ghaffari of Vulcan Capital, and ValueAct after they gained a seat on the board). This was especially prominent during the period of time when Xbox was at its lowest point after the Xbox One reveal but these sorts of calls have died down since they have managed to turn the division around by cutting costs and focusing on profitability.

But all of this must be #FakeNews and I'm the ringleader of Twitter warriors.

Nice 3+ year old articles you got there. Super relevant to today.

 

[TheThreadsThatBindUs]

Your whole point falls down around you buy saying Xbox is a console business, its not, its a platform. That's why the reporting has been updated to reflect that. Yeah, hardware is a big chunk of it, but as long as the end-goal of store monetization is on the healthy rise, which it is, then its a good outlook.

Or... you know... MS updated the way they were reporting the numbers because their hardware unit sales figures aren't nearly as impressive as their direct competitor.

This is the kind of thing companies do all the time and MS is no different.

MS' Xbox business is no more or less a console/platform business than Sony or Nintendo's is. Outside of their software published on PC, the business model is almost identical (to Sony's at least). In which case, why aren't the other two changing the way they report the numbers if hardware isn't important anymore?

Because if course it is, it's just that MS decided to obfuscate their hardware sales performance because they clearly realize it's not favorable in comparison to their competitor's sales performance.

Also, on the stock price, issue. I didn't quote you out of context. You just made a inaccurate statement about the effect of Xbox division's performance on the larger corporation's stock price. Xbox in a rather small piece of MS's pie. Even if the business was tanking, it would barely affect the stock price, because the primary businesses of most value to MS investors aren't currently called Xbox.

 

[leeh]

Are you serious?
Revenue up 13%, net profit doubled and you ask why their price is up, despite the One business, they obfuscate to hell and back, continuing not doing so well?


Low level compared to their competitor aka Sony.
The gap is widening not closing, in absolute terms and with numbers like these very likely also in relative ones.

With gaming revenue being 3% of that increase. What you've just accused MS of is being illegal.

Sony are making more revenue from their PlayStation division, but it isn't linear compared to their increased market share, so you could argue they're not performing as well at monetizing their platform as well.

Like I said above, just because Sony are smashing it doesn't mean MS "aren't doing well". If that helps you sleep at night and feel satisfied in your plastic box, feel free to keep thinking it.

 

[GHG]

Your definition of a typical investor couldn't be more the opposite. They mostly care about long-term strategy, especially shares like MS with dividends, its all about the squeezing every penny from the consumer by monetizing them in the best way possible. That doesn't mean selling loads of consoles with tiny to no margin. That does mean using a long-term strategy of building a healthy eco-system to take your share in royalties fee's on digital goods which cost you next to nothing in comparison.

Something that both MS (evident by 11% store revenue increase) and Sony seem to be doing excellently at these generations. They're both not dumb.

It often largely depends on the investment strategy of the invididual/company involved and what their beliefs are on what would/wouldn't be healthy for the business. Reinvestment vs dividend payout is a discussion that commonly takes place at board level. If the investors are more concerned with short-medium term returns through dividend payouts then they will push for the strategy that involves the least investment as it means a higher proportion of the profits can go towards dividend payouts. That also often results in the share price going up in the short term - increased dividend payouts are attractive along with the fact that if you choose not to make a new investment (which would require a capital outlay) it reflects more positively on the financial statements.

If the investor is genuinely concerned with the overall health of the company then yes they will think about long term strategies along with where profits can potentially be reinvested but that is not always the case. If a division isn't turning in a profit then there will be certain investors who will not hesitate to push for it to be gotten rid of because it directly effects their more immediate dividend payouts. Short termism is more prevalent in investing now than it ever has been because it's easier than ever to gain access to information and move money quickly on the markets.

Nice 3+ year old articles you got there. Super relevant to today.

While I appreciate you reading that one post of mine and seeming only that post, there are posts either side of it that will help you understand why.

 

[Omnii-chan]

X1S momentum fizzled out pretty fast. The software side is helping keep things somewhat positive but they need to address the hardware problem.

Scorpio.

I think they need better first party. Apparently they are working on that, but it remains to be seen.

 

[wapplew]

I think they need better first party. Apparently they are working on that, but it remains to be seen.

No they don't.
They generate more money than Nintendo who have best first party and sold more hardware in the same quarter.
Further prove hardware numbers and first party means nothing.

 

[VincentMatts]

I think the same thing that happened to X1S will happen with X. They need stuff that can push hardware or they will be in the same scenario around this time next year.

Yes of course, but having a new much more powerful console coming out so soon after the S was gonna make more people just wait.

No matter which games would be out, id still be waiting for the X.

 

[therealbigrich]

Yes of course, but having a new much more powerful console coming out so soon after the S was gonna make more people just wait.

No matter which games would be out, id still be waiting for the X.

S is going to outsell the X 5 to 1 but I can see a lot of ppl waiting for the X at this point. It's pretty much August so that means 3 months until release. Not far at all

 

[AmFreak]

With gaming revenue being 3% of that increase. What you've just accused MS of is being illegal.

What are you even talking about?!?
I have them accused of nothing.

Sony are making more revenue from their PlayStation division, but it isn't linear compared to their increased market share, so you could argue they're not performing as well at monetizing their platform as well.

Sony doesn't release on Pc, Sony also doesn't have Minecraft and above all Sony gives away income numbers ...

Like I said above, just because Sony are smashing it doesn't mean MS "aren't doing well".

You don't need Sony to call a 30% decrease in hardware and 3% increase overall not good.

If that helps you sleep at night and feel satisfied in your plastic box, feel free to keep thinking it.

Lol, i don't even have a horse in this race - projecting much.

 

[Jeff Freecss]

Yeah, how dare people talk about obvious not so good points of a financial report. We have to celebrate no matter what.

Revenue increased? Hallelujah! Only a 3 percent increase while console base increased 20+%? Who cares.

Software slightly up? Hallelujah! Hardware way down due to less Xbox One consoles sold in a whole quarter than PS4 just sold in one month? Who cares.

Let's also ignore that a profit number is nowhere to be seen.

When your whole company's profit is up 68% and non of your business is loosing money, I don't see why it's a must to disclose the profit of one particular segment of your business. Xbox and Surface now mainly function as a consumer friendly PR tool for Microsoft. And it's working. The Surface and Xbox product garner most of the YouTube views from any Microsoft related Channels. I know some people who don't have a Xbox or Surface wish Microsoft's hardware will just fail but they are the most important marketing division for Microsoft nowadays. I highly doubt Microsoft will just close the Xbox Division.