S0ULZB0URNE
Member
The fear of this is exactly why I don't support this service or PSNow.
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The Eradicator
Member
Publicly traded companies have to provide that information to their investors, that's why.
The Eradicator
Member
That simply isn't how the financial sector evaluates things. Quarterly earnings and YOY projections DO affect how investors view a stock. And missing projections in only one quarter CAN lead to budgetary changes within a company.
Seems pretty obvious that this thread has two different conversations happening. I'm simply pointing out how investors look at things much differently than players do.
(BTW I own stock in MS, that's why I'm not talking out of my ass here. I follow this stuff for a lot of companies)
mejin
Member
The Eradicator
Member
People trying hard to ignore what numbers mean
OmegaSupreme
advanced basic bitch
There would be a similar thread for any other game company missing their publicly stated sales goals.
DenchDeckard
Moderated wildly
Imagine a business seeing 37% YOY growth, the year after the COVID boom and it being painted as a negative.
Some of you guys are crazy.
Some of you guys are crazy.
Probably, I personally am interested to see what that goals are. I assume that it probably is going to be the US publicly traded companies that share this?
Darlingcognito
Member
It’s not 37% growth people. Growth itself is up 37%. Holyhow is this being misunderstood.
Let me explain.
If they were at 18 million subs and actually had 37% growth over a year they would land at 24.6 million.
If they had 18 million subs but growth had been 1 million a year in the previous year and THAT number actually went up 37% (which is what actually happened) they would have grown by 1.37 million for a total of 19.37 million. This is almost the exact total number speculated, meaning total growth is actually a smallish number. Even if it goes to 100% growth that will only be 3 million subs over a year. To hit 23 million. It’s going to need to hlike 1000% increase in growth to hit this 50 million in two years that some here are speculating.
At the current rate it won’t hit 30 million by the end of this gen. A large uptick in subs needs to happen and there can’t be a lot of churn.
That is the reality of the currently released numbers and percentages.
Is that you Shawn Layden?
chixdiggit
Member
Never understood all the users here that seemingly just can't wait to shit on gamepass.
It's a great service. Same with Netflix and Spotify, I personally couldn't care less if I own it or not. I just want to watch movies, listen to music, and play games. Those services give me a great selection at a cheap cost.
It's understandable if it's not for you but why the need to be so negative about it? You can still go out and pay to own movies/music/games. No one is taking that away from you.
It's a great service. Same with Netflix and Spotify, I personally couldn't care less if I own it or not. I just want to watch movies, listen to music, and play games. Those services give me a great selection at a cheap cost.
It's understandable if it's not for you but why the need to be so negative about it? You can still go out and pay to own movies/music/games. No one is taking that away from you.
The Eradicator
Member
It's funny to see how many people here just do NOT understand how these things work. Being at 37%, when you told investors that you would hit 48% IS a negative. Take the name Microsoft out of the equation here, and take a big step back, and maybe you can see why it matters.
Missing a growth target by more than 10% of any kind for a publicly traded company is not good news. Companies who miss revenue growth targets by 10 cents often get hammered. Doesn't mean gamepass is dead. Just means that the company will have to figure out what to do with it going forward. Could mean less budget, less aggressive sales projections. Or it could mean Microsoft gets more aggressive. It just depends on the data behind those numbers and how management interprets it. But to simply say "37% is a lot, it doesn't matter they missed their projection" Doesn't know how businesses work.
Gameplaylover
Member
Why am i not suprised this topic will make it to 500 answers?
Klayzer
Member
Its really hard to have a legit conversation on numbers, when you have so many here to derail/ troll any discussion that may put their favorite corporations in a possible negative light.
Every sales/quarterly topic always ends the same way. I would be nice if we had an influx of new viewpoints, instead of the same old rehearsed PR lines.
Back on topic, Im curious to her more of your thoughts on the subject. You seem to have an anyltical mindset, without the excessive victim complex.
Gameplaylover
Member
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kyoji
Member
This man gets it.37% of not profitable grow....
I understand that its suppose to be a long term investment, but in the gaming industry what isnt considered a ‘long’ term investment these days? That doesnt mean companys dont expect to meet there quarterly goals. Theres no spinning that they are losing money on the service as of now at least, so id say yeah… i dont think there numbers team are very pleased when they projected one thing and come in with something 10% lower thats already not profitable. This would also explain why there pr have back tracked in recent months on announcing numbers for there main feature of the platform.
Am i saying doom and gloom? No, but its definitively not what they would like. Cannot spin that.
Duchess
Member
I have to wonder how much of that 37% was made up of those who acquired the service via deep discounts.
Probably not a great deal, but one needs to factor in such things when considering the numbers.
Edit: by discounts, I mean things like $1 deals and also companies offering it for 3 months with the purchase of a mobile phone, etc. (O2 in the UK offered something like this).
Probably not a great deal, but one needs to factor in such things when considering the numbers.
Edit: by discounts, I mean things like $1 deals and also companies offering it for 3 months with the purchase of a mobile phone, etc. (O2 in the UK offered something like this).
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The Eradicator
Member
That's not how percentages work. You can't just add and subtract them
Hitchyhero
Banned
So I presume all these people have no Spotify, Netflix, disney+, prime, HBO, aaple music... Or even buy games digitally.
Otherwise they'd be hypocrites.
Think the main issue for me as casual investor is that I don't have any comparative numbers, if not for a subscription service but at least gaming revenue. I am personally more interested to see what next week's numbers look like and how they compare to the rest of the market.
As a shareholder, I can't tell if they fucked up the targets this year cause they also missed Teams (much more important to Microsoft as a whole, obviously irrelevant for xbox) and I think Surface but obviously I would have liked them to hit their growth targets across the board.
The Eradicator
Member
There's something I've noticed after many years of talking to people online. The overwhelming majority of people just do not have a firm grasp on how percentages work. If they're not figuring out the % out of 100, then they just won't have any concept of what they're talking about. Good to know that a few people still have a handle on things.
and also in all other threads people trying to spin this as something negative ... taking it out of context ... would be considered stupid
Bernd Lauert
Banned
I never argued this.
It can, but in this case, it won't.
I own MSFT too. Who doesn't? It's in basically every standard portfolio.
ill fix for you ..here is not famous because PlayStation doesn't have something similar
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Just for context and I know there is an massive assumption that the year 2 target is independent from the year 1 actual growth which isn't obviously true but they ended up slightly ahead.
Post in thread 'Xbox Game Pass subscriptions miss Microsoft’s target' https://www.neogaf.com/threads/xbox...iss-microsoft’s-target.1621499/post-264851681
As someone mentioned, I would be interested to see what Microsoft's 5 year prediction would have been in 2019.
The Eradicator
Member
Yes, like how Netflix just said that they value Squid Game at around 900 million dollars! They clearly except an influx of new subs just to watch that show. Big, tentpole titles drive big growth. Otherwise, you'll just trundle along your years
Manwithoutfear
Member
i just will never understand the gamepass hate lol. it's such a great value. halo, forza, back 4 blood all within 3 months. meanwhile i had to pay 70 for ratchet and clank, returnal, and all other games for my ps5.
The Eradicator
Member
I would love for gaming companies to crack open their earnings, like the movie industry does. Yeah, the 5 year course projection would be very interesting information. They most likely overcompensated for this year's growth rate, due to them exceeding expectations last year. They MAY very well be ahead of their initial plan, we don't know.
What I do know for certain is that it still is not ideal for the Game Pass division to miss their projections, strictly from a financial standpoint. Budgets are allocated directly due to performance v expectations. If the division doesn't hit the numbers, they'll likely have less money to throw at the problem in next year's budget. I know that a lot of people here are not going to look at this from a business standpoint, but rather as fans of Xbox. Missing projections is one of the most common reasons why investors would pull out money.
Now, MS is so big that one division isn't going to affect them much. But it will affect the Xbox division. Not sure why people are so hard up to deny that though.
kungfuian
Member
Would be interesting to see how many of the 20+ million subs were already existing x-box owners vs. new to the Microsoft platform.
If their growth has slowed (missed targets) it may indicate a much bigger problem, that they have only succeeded in converting gold members and those already on their platform to the service. The slow down could be an indicator of the limited size of that group and thats a much bigger problem than software arriving late.
To be 'successful' at the numbers they'll want/need (to support the business model) they need to expand gamepass to new customers.
My thoughts are that growth of gamepass subs will further slow/stagnate until they can get the service on phones via cloud in all markets. And at that point, for real growth, the 'traditional' console game experiences on offer will need to change to meet the tastes of mobile phone gamers. Microsoft have yet to show they can do this.
If their growth has slowed (missed targets) it may indicate a much bigger problem, that they have only succeeded in converting gold members and those already on their platform to the service. The slow down could be an indicator of the limited size of that group and thats a much bigger problem than software arriving late.
To be 'successful' at the numbers they'll want/need (to support the business model) they need to expand gamepass to new customers.
My thoughts are that growth of gamepass subs will further slow/stagnate until they can get the service on phones via cloud in all markets. And at that point, for real growth, the 'traditional' console game experiences on offer will need to change to meet the tastes of mobile phone gamers. Microsoft have yet to show they can do this.
Bernd Lauert
Banned
People are just afraid that Gamepass will accelerate the death of physical games.
What they don't realize is that physical is already dead.
Gameplaylover
Member
Nope. The problem is that Sony doesn't have Game Pass. If they would have it, this thread would have 1 page.
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The Eradicator
Member
TheGodfather07
Member
Alot of people probably use the dollar deal but never actually pay the full price and subscribe. Why continually subscribe when you can pick and choose based on the games you want to play. The subs will fluctuate depending on the games. when a big game drops, microsoft will see an increase in both console and subsciption sales. only a small minority will buy their 1st party games at full price owned copy. most will subscribe to gamepass.
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Bernd Lauert
Banned
There's a big difference between a company missing its target by 10%, or a subdivision of a subdivision of a company missing its target by 10%.
Topher
Gold Member
Question answered. Anyway, here is the target core metrics.
https://www.sec.gov/Archives/edgar/data/0000789019/000119312521298757/d189481ddef14a.htm
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The Eradicator
Member
You're acting like what I'm saying is crazy. If you actually have a portfolio that you follow, then you'd KNOW that this I'm merely stating how the investment industry thinks. Laugh away, I guess, but I don't understand why you would, if you actually understand the market
The Eradicator
Member
I know that. I've literally said that 3 times in this thread already. When did I say otherwise, in any way?
XXL
Member
FY21 Target/AchievementWhat am I missing here? The target numbers being discussed in the article are for fiscal year 2019.
https://www.sec.gov/Archives/edgar/data/0000789019/000119312521298757/d189481ddef14a.htm
I agree with you on this.
The one thing that I don't know how to account for and it might not happen cause it might be irrelevant for major investors but in the next 1 to 4 weeks, we are getting the results of the big 3 platform holders. If MS sees a reasonable set of results relative to the other two, I don't know how that impacts plans. Need to double check when MS earnings call is.
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SEGAvangelist
Member
That 48% number was likely expecting a Halo release in 2020 and more consoles on the shelves, right?
I would assume so but we don't know for sure.
Chukhopops
Member
Yep, the target was made a bit before June when the delay was August 2020 (and the reveal was July 2020). There was also no visibility on confinement, supply shortages, etc.
I don’t think it’s a big deal especially when competitor subs were growing by 2.8% over the same period.
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The Eradicator
Member
It actually shows something quite interesting, which isn't being talked about. By not hitting their 2021 projection, Game Pass lost ground in relation to the other services. That's probably not a big deal through, because MS had a lot of cloud service action in the past 2 years. They didn't maintain that 7% figure, however, it dropped to 5% of their total. That's precisely the type of thing that could get their budget cut, which is what I've been talking about. If MS thinks that more money should be going into the commercial cloud divisions, then the money has to come from somewhere. Teams and Game Pass didn't hit their projections. Cloud services exceeded projections. Guess where the investment money goes for 2022?What am I missing here? The target numbers being discussed in the article are for fiscal year 2019.
https://www.sec.gov/Archives/edgar/data/0000789019/000119312521298757/d189481ddef14a.htm
Edit: yes, I realize that this is not the total ls for the entire company. What I'm saying doesn't change though
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Bernd Lauert
Banned
It was also expecting the Covid boost to go a little further. Teams also didn't quite hit expectations for the same reason.