Microsoft announces 20 per cent decrease in annual Xbox sales

Microsoft announced a 20 per cent decrease in sales from the Xbox division, following a drop in the amount of Xbox 360 and Xbox One sales from two million to 1.6 million.

It follows the Xbox 360 starting to retire from commercial sale and the Xbox One continuing to live in the shadow of Sony’s PlayStation 4, which has been at the top of the console sales in the US and Europe for three months.

This brought a 24 per cent decrease in revenue during the quarter for the Xbox division, due to the lower cost of the Xbox One throughout 2015. Microsoft did state the Xbox One is now cheaper to manufacture, thanks to the removal of the Kinect sensor from the bundle.

Not everything was bad news, Microsoft announced a 83 per cent increase in first-party sales. Minecraft was the major factor in the sales increase, which Microsoft acquired alongside the developer Mojang for £1.65 billion late last year.

Microsoft also noted a 30 per cent increase in Xbox Live customers. There are still way less Xbox Live customers on Xbox One than Xbox 360, but it is to be expected given how long the Xbox One has been in circulation and the lack of core multiplayer titles on the platform.

Under the leadership of Satya Nadella, Xbox is playing less of a role in the growth of the business. Nadella effectively shut down all entertainment sectors in Xbox and is looking to hone in on the software and services market, pushing it onto the Xbox One with the Windows 10 update.

That makes acquiring Mojang all the more strange, even if it is a cash cow at the moment for gaming. Perhaps Microsoft has some long term goal with Minecraft like adding it to Windows Holographic, it has already named one update in 2016 after a Minecraft block.