Xbox Console Sales Continue To Crater With Massive 42% Revenue Drop

Well... could it be that they saturated?
I mean, the consoles been out for a while, I suspect at this point everyone remotely interested has one?
- That'd make sense, but that's still a negative sign, as PS5/Switch have yet to meet saturation.
  
  Thing is, they don't need to sell consoles anymore. They're in the gamepass business now. This is why they're pushing gamepass on phones, PCs, Samsung TVs and Firesticks. They don't really care about selling you a box under the TV anymore since they're usually sold at or near a loss anyway. They just want you on the subscription wherever you can play it.
  They currently have roughly 34 million subscribers (as of February, I'm guessing Activision Blizzard King is going to bump this number up further), let's assume an average of $12 a month. That's over $400 million coming in every month or 1.2 billion every quarter on the books. They don't have to rely on a big game to have a good month.
  You're more valuable to them having the gamepass subscription and just playing on your phone over someone who buys a console and purchases 7 or 8 games a year. Articles like this fundamentally misunderstand the current gaming landscape and their business model. They're not losing the race, they're playing a different sport.
- I think they fucked up with the series s/x. The Balder's Gate 3 release made me realize that their policy that games needed to have the same features enabled for both the s and x essentially meant that even if you spend the extra money on the x, it will be held back by the s merely existing.

They could stop charging gamers a subscription to play the paid games (they "own") online.
This could attract some customers that don't want to deal with PC or don't want to add fixed costs to their monthly or yearly bill.
- They could stop charging gamers a subscription to play the paid games (they “own”) online.
  This is one of the key reasons why I own PS5, but I don't play or invest in it. Even though couch gaming is much more comfortable for me.
  
  I'm in the same boat.
  Elden Ring, Helldivers 2, many games I'd get on Sony PS Store that I just get on Steam because I want to "own" the full game not just the offline part of it.
- Microsoft not being evil? Not going to happen. (Except for smokescreen purposes and amounts)
  
  There was a time where it was worth the money because it was far and away better than any free online offering. That time was probably up to about 2010. Now that servers are paid for with digital game sales, it would behoove them to drop the fee. Instead, I think they're just about to change the console market as we know it.
- I would actually consider getting one if that were the case. But no console maker will ever do that again - too many suckers willing to pay. Sony at least lets you play F2P games online without a sub.
  
  Xbox is the same with f2p. Fortnight and those minds games are free

Maybe don't close the studios making your only good games next time? Dunno, just a thought
- This was the reason I left. Don’t fire your flagships.
  It’s one of those pieces of advice like “Don’t lie on the ground naked next to a fire ant colony” but I guess some people really are that stupid.
- The studios they kept around are making games that are a shadow of their former selves too - Halo Infinite and Forza Motorsport come to mind, as well as Starfield. Microsoft Flight Simulator is the only really good one still as far as I can tell.

I'm not surprised. My experience with Xbox has declined over the last few years now so wouldn't recommend it to anyone anymore.
- What has changed if you don't mind?
  
  I bought the newest console to play the most recent Halo. It truly sucked
  The first Bethesda exclusive game was Starfield. It truly sucked
  The recent focus has been towards online multiplayer and GAAS. Toxic games and toxic service models.
  The ads are insane. Sometimes I'll turn the console on to a full screen ad about Diablo or Game Pass I have to acknowledge before actually using the console. Beyond that there is designated space on the home menu for 3 different banner ads.
  Just my opinions as someone that's enjoyed that xbox brand since the first one, and stuck with it out of convenience and from making friends on the network there. Next "console" is a proper gaming computer
  
  I was a heavy Xbox user up until last year when they redesigned the Xbox home screen.
  Instead of being able to pin multiple groups of custom apps/games wherever you want, you now only get one group pinned about halfway down the page past several rows of ads. There are generally at least 5 separate rows of ads on the homescreen at all times.
  I have a series x (also had an original, 360, and one), and will 100% not be buying another console from Microsoft. The joy of using my expensive console was ruined by ads.
  I need to finish Elden Ring, after which my Xbox will be used as a steaming device for videos from my PC or Kodi exclusively.
  Edit - upon checking it looks like you can actually pin 2 custom groups. But there are also really 14 rows of ads, not 5, so....
  
  TANGO
  Tango Tango Tango.
  Confused? Search "Xbox Tango Gameworks"
- Games = Usually okay
  Console = Nah
- Same. I recently bought a PS5 after being an Xbox user since the post-N64 days. The difference in quality is substantial.

They really do seem dead-set on transitioning to a software rental company. Let the hardware languish and shove another tier of Game Pass into the marketing grinder.

I started dropping off after every time I started to boot my Xbox it just was just ads upon ads trying to sell me stuff and not gettin me into the games faster.
- Oh crap. That just PlayStation's going to do it too. Right now I get ads at the bottom and games at the top so I can at least jump straight into a game. Assuming I don't boot straight into one because I went to rest mode in it.
  But the second MS proves this, Sony will follow.
- I use mine primarily for media and occasionally play online with friends. They killed gold, and reverted to game pass core, so now I have to pay $10/month to play games I own. They are deleting my purchased games, ea archived an active account for inactivity when I had playtime in the calendar year. There is no new IP, they shut down studios, and raised prices, locked us into a shitty platform and started monitoring and monetizing their paid users.
  They deserve this
- 🤢🤮

My Baseless Prediction, i.e. if I ran Xbox, what I would do given their situation:
Microsoft will sunset the Xbox as a console but focus on creating a dual boot mode for Windows similar to the Steam Deck and Big Picture Mode. Probably called “Xbox Mode” or something similarly unoriginal but evocative. This streamlined mode will greatly reduce system overhead and be controller-centric, and it will have an emulation layer to support all Xbox ecosystem games along with backward compatibility. On certain form factors it will be the default boot mode, and supporting this they will release two new Windows PC form factors: a living room box and a handheld. Other PC manufacturers will be able to jump on the wagon as well. I doubt they will in any way define reference performance profiles akin to a console “generation” but they may have some kind of guidance regarding how graphics should scale seamlessly between TV/monitor and handheld form factors to allow for a Switch-like docking experience.
- You need to shoehorn some AI into this tho
  
  Uggggghhhhh. Me, I’d just support DLSS-style upscaling and call it a day but realistically there will be some GenAI bullshit for sure.
- If it means my console friends will finally play on PC I'm for it
  
  I mean technically yeah. But it might also mean some meeting-in-the-middle on what PC/console even means. It’s probably push PC fanning even more toward being console, with the benefits of more consistency and less cheating, but the downside of being less flexible and more crowded with console players. Probably also a bigger push for buying PC games through the Microsoft store when possible.
- This is what I believe too
- This streamlined mode will greatly reduce system overhead and be controller-centric
  This doesn't sound like anything Microsoft has done before.
  
  For what it’s worth, Windows 8, while tragically mistargeted, was a marvel of streamlined engineering.
  But your skepticism is sound. Microsoft hasn’t been able to execute a bold and cohesive vision in at least a decade, if arguably ever.

Because no one wants a console with ads, has no gyro aiming, strange support for older Xbox/games.

They lost me forever when they tried to make the Xbone unable to play games unless you were online.

Let me just fire up all these Xbox exclusive and first party games they've released since like 2021...
- I have a real opposite problem with exclusives. I don't think they should exist. A console should just be a means to an end: to play a game.
  I get why they do it but it's bullshit. It's just a custom PC that plugs into a TV.
  
  The case I see is like this: Many publishers increasingly argue that they don't have a strong monetization plan for big epic singleplayer games unless they have a dozen forms of microtransactions. For Sony, the monetization plan for God of War is the PlayStation 5 - and all of the residual purchases that come after someone owns one. 80% of those purchases will be of games that are on both Xbox and Playstation - but went to the latter because God of War and Spiderman are awesome. With that in mind, the teams making those games can sorta just aim for awards, not perfect profitability.
  
  I completely agree. Console exclusives are crap. Especially with how good PCs are.
- Halo Infinite - failed
  Starfield - failed
  Forza Motorsport - terrible launch
  Redfall - failed
  Out of curiosity, I googled exclusives for Xbox series exclusives. They've got things like Forza Horizon 5, sunset overdrive and Ori. Like, sure, but you can't say proudly that your console is being held aloft by 4+ year old titles when the competition is releasing banger after banger!
  They just missed the mark. You can spend billions on R&D and marketing for a new console, billions on buying up game studios to make new games, but if your games suck on launch, people won't play on your console.
  What XBox has done this generation is borderline suicide.
  
  I know Ori is also on Switch. I’m not sure about Ori 2.
  
  Ori and Forza are on PC, I don't know about the other one

Xbox is dead as a console, but will live on as Game Pass on PC, Smart TVs, Portable, and an eventual ARM puck you bring with you.
The industry is going to be in a weird place where Sony and Nintendo are the only first parties and hardware vendors. Its too costly for an upstart, they can just focus on the PC.
- I think this is a good point. Heavy gamers are going PC. More flexibility and more ways for them to play. That leaves casual gamers, which previously might buy a console, but it'd eventually collect dust. New game streaming services serve them better.
- Game Pass is trash. I only play GoG games, at this point.

I'm getting rid of my xbox when the ps5pro comes out. the fact that the Xbox just keeps regressing in features (I can't plug in a USB microphone wtf?????) and rising costs of game pass just pushed me back to Playstation.
- I was disappointed to find out that my PS5 doesn't support Bluetooth headsets. You've gotta get one of the Sony ones I guess. The controller looks like it has an RCA port for analogue headphones and a built in mic, so it might fit your use case but I was pissed when it wouldn't let me use my wireless bone conduction headset instead of the earbuds on the PSVR2. I usually just use my TV speakers because earbuds never stay in my ears properly, but it would be nice to be able to play without worrying about the volume being too loud for others, like late at night.

Opening the door to a switch to a Steam Deck competitor instead
- I have some questions there.
  hHs that even ever been so much as rumored? There were leaks from various suppliers hinting at the Deck and Switch long before they were in develop. It's possible I missed something, or possible they just haven't leaked anything, but so far I don't have a reason to think they would be trying to enter that space.
  Microsoft seems to be abandoning that space. The Windows phone died ages ago, and the Surface seems to be languishing.
  Operating System. Would it be windows? There are already plenty of handhelds that run windows, and usually the biggest problem people have with them is that windows sucks for that application and they replace the OS. Would they have a custom OS like the Xbox? What would it bring to the table that Steam LS doesn't? Valve already put in a ton of work to get Steam OS as good as it is- would Xbox/Microsoft do that too? If it just uses Steam OS, what does the hardware bring that differentiates it from the Deck?
  Software. I don't know what the unit cost of a Deck is, but I'm guessing it's pretty close to the sales price. The Deck does not need to be a profit center for Valve as long as it drives software sales on Steam. The Microsoft store has already failed- would an Xbox store on such a device manage to be profitable? Would it be locked down and incompatible with Steam? Maybe they could partner with Epic to compete? I'm just having a hard time seeing Xbox/Microsoft enter that business model.
  What might be more likely is something like the Portal or G-Cloud. An ARM-based, lightweight product designed to be used for cloud gaming with GamePass. Maaaaaybe some local streaming from your PC or Xbox too. Even with that they would be competing against other products and pretty much every smartphone and tablet. There might be room to move some units, but similar to Sony I don't see that being huge.
  
  It's all rumors and speculations.
  Keep in mind that the products that exist already don't have the OS developer behind them, Microsoft could do exactly like Steam and have a gaming ready UI based on the Xbox UI and plain old Windows 11 running in the background (tweaked to better fit the portable PC setup).
  Considering that Xbox sell less and less, that the Xbox is basically a locked down PC at this point, that people go crazy for portable PCs and that they can actually replace a console... I mean, it would make a lot of sense. They already have a hardware division as well so...

I think they saw the writing on the wall with PC gaming resurging
- Yep. If it isnt dedicated couch coop or party games, why wouldn't you get something with minimal/no vendor lock, and hardware you can control/upgrade?
  
  Well once upon a time a console was a small fraction of the cost of a PC and the experience was put game in, turn console on, play game. Sure a console had a fraction of the computing power of a contemporary desktop but typically they had hardware specifically for graphics and sound and games were usually coded very efficiently for the specific hardware often directly in assembly.
  That hasn't been the case for a good long while now. Consoles and their games receive updates just like PCs do. Yes the purchase price of a PC and its associated hardware is probably does still cost more than a console...until a few months of paying for those subscriptions go by. Console hardware is now very closely related to PC hardware. So the value proposition is for the price of a low-end gaming PC you get a lower-middle class gaming PC with a 90% less useful operating system, recurring costs and worsened versions of games.
  Meanwhile Valve says "Yeah we made using a normal gaming PC on the living room TV work pretty well a WHILE ago. Also, you know the Nintendo Switch? Well we've built a full fat gaming laptop into a similar form factor of portable device. It's an x86 PC, it runs PC games natively. It runs Linux, you can get to a desktop, hook it up to a keyboard and mouse and you can do spreadsheets and run CAD on it for all we care." And it's been such a big success that several competing products have been hastily pushed out that run off-the-shelf Windows and none of them are as good.
- It's mobile gaming too. Phones are eating their lunch on the small games. PCs are doing it on big games. And it's their own restrictive rules that caused it.

Imho, Xbox fully died when the 360 was taken offline.

I have two kids. Both prefer pc or switch for exclusives. They haven’t touched the PlayStation or Xbox in months if not years. I don’t even think they know how to turn them on.

To be fair I don't think I've seen good things about Micro$oft in years. I'm honestly not surprised.

I just bought an RGH3 hacked 360 off etsy today after the Xbox live closure. Actually pretty siked to go back and play some of the 360 games I missed back then that have been stuck on that console generation.
If only that sale counted .
- Next go with a PS3 and hack the fuck out of it. 1tb max hdd, free games market. My kids love it.

Why do you link to another link aggregator instead of just linking https://arstechnica.com/gaming/2024/07/xbox-console-sales-continue-to-crater-with-massive-42-revenue-drop/ directly?
- Because I read it on said link aggregator. And I like the concise no-bullshit format of slashdot. I'm sorry it offends you.

The last Xbox I had was the 360 so take this with a grain of salt, but they made the choice between XBone and PS5 so simple for me by making all XBox titles playable on PC. As someone who would entertain buying both consoles, I never found a compelling argument to bother.
- How do you play Xbox titles on PC? I thought some didn't work?
  
  As far as I can tell, every game that's listed as XBox exclusive on Google is available on PC Game Pass. I played Forza, Halo Infinite, Flight Sim, Sea of Thieves, Starfield, Ori, etc.

Every xbox360 console I have owned or known others to own was defective within a short timespan. I would never trust their hardware ever again.