Microsoft Earnings FY24 Q4; Xbox Content up 61%, Up 3% minus ABK, Xbox Hardware Minus 42%

[John Elden Ring]

Microsoft just posted the fourth and final quarter of its 2024 fiscal financial results. The software maker made $64.7 billion in revenue and a net income of $22 billion during Q4. Revenue is up 15 percent, and net income has increased by 10 percent.

Xbox content and services revenue, which includes Xbox Game Pass, is up by 61 percent this quarter. Activision Blizzard revenues have once again contributed to the majority of revenue here, with 58 points of net impact. Without Activision Blizzard revenues, Xbox content and services revenue will still have been up three percent year over year.

Despite the poor Xbox hardware revenue, gaming revenue at Microsoft is up 44 percent overall, helped again by the additional Activision Blizzard revenue. In fact, that revenue added 48 points, so overall gaming revenue at Microsoft would have been down four percent if the company hadn’t acquired Activision Blizzard.

While there’s a lot of anticipation for new games on Xbox Game Pass, console sales are still struggling. Xbox hardware revenue is down a massive 42 percent this quarter. Microsoft is planning to launch a discless Xbox Series X console in white later this year, alongside a new Galaxy Black special edition Xbox Series X.

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Microsoft’s cloud revenues rule again in Q4, as Surface continues to dip​

Microsoft just posted the fourth and final quarter of its 2024 fiscal financial results. The software maker made $64.7 billion in revenue and a net income of $22 billion during Q4. Revenue is up 15 percent, and net income has increased by 10 percent.

Microsoft’s Intelligent Cloud revenues, which includes the company’s server products and cloud services, was $28.5 billion overall and up 19 percent year over year. Revenues from this part of Microsoft’s business now make up nearly 45 percent of all revenue. While cloud revenue is strong once again, Microsoft’s consumer devices push continues to dip. Surface revenue has now declined for seven consecutive quarters in a row.

Windows and Surface revenue
Windows OEM revenue, the price that manufacturers pay to license Windows for laptops and PCs, is up four percent year over year. Gartner said earlier this month that PC shipments had grown for three consecutive quarters, and that’s reflected in Microsoft’s Windows OEM growing in the same three quarters.

Microsoft also launched its new Copilot Plus PCs toward the end of fiscal Q4, with a variety of Qualcomm-powered devices available from June 18th onwards. Two new Surface devices, the Surface Laptop 7th Edition and Surface Pro 11th Edition, also launched in June. The full impact of sales on devices revenue won’t be felt until next quarter, though.

That means Surface revenue, or what Microsoft now calls devices revenue, has declined again this quarter by 11 percent. The last time Microsoft’s Surface revenue was up was in Q1 FY23, the quarter ended September 30th, 2022.

Microsoft switched up its hardware portfolio amid layoffs in early 2023, and the Surface Pro 10 and Surface Laptop 6 for businesses don’t seem to have had a big impact on revenues. All eyes are on next quarter to see if the new Surface Laptop and Surface Pro launches have helped devices revenue recover at all.

Xbox and gaming

Xbox content and services revenue, which includes Xbox Game Pass, is up by 61 percent this quarter. Activision Blizzard revenues have once again contributed to the majority of revenue here, with 58 points of net impact. Without Activision Blizzard revenues, Xbox content and services revenue will still have been up three percent year over year.

Microsoft revealed in February that Xbox Game Pass has now grown to 34 million subscribers, including the Xbox Game Pass Core (previously Xbox Live Gold) members. Microsoft is planning to launch a new Xbox Game Pass Standard plan soon, which is designed to replace the Xbox Game Pass for Console offering for new subscribers.

Microsoft just launched last year’s Call of Duty: Modern Warfare III on Xbox Game Pass, and it’s also planning to make Call of Duty: Black Ops 6, the next installment in Activision’s popular franchise, available on Xbox Game Pass later this year.

Microsoft’s price hikes for Xbox Game Pass Ultimate and PC Game Pass don’t come into effect until September, with Game Pass Ultimate increasing to $19.99 a month — a $3 increase over the current $16.99 a month pricing. PC Game Pass is also moving up to $11.99 a month in September.

While there’s a lot of anticipation for new games on Xbox Game Pass, console sales are still struggling. Xbox hardware revenue is down a massive 42 percent this quarter. Microsoft is planning to launch a discless Xbox Series X console in white later this year, alongside a new Galaxy Black special edition Xbox Series X.

Despite the poor Xbox hardware revenue, gaming revenue at Microsoft is up 44 percent overall, helped again by the additional Activision Blizzard revenue. In fact, that revenue added 48 points, so overall gaming revenue at Microsoft would have been down four percent if the company hadn’t acquired Activision Blizzard.

 

[Jivesh1995]

Hold up.

Microsoft bought two whole-ass publishers and this it what they have to show for it? Hardware DOWN almost half in a year...lol

 

[Entropi]

Activision is carrying Xbox into becoming a full 3rd party publisher like EA.

 

[AllBizness]

Last I heard PlayStation still has more revenue and profit even though Xbox has Activision now lol.

 

[anonpuffs]

Couldnt have happened to a shittier company. Eat dirt MS

 

[Puff]

Xbox Hardware Minus 42%

 

[Plextorage]

Found this post on Era regarding Xbox financial reports :
"Numbers are pretty bad overall and the only numbers that look somewhat decent are because of the ABK acquisition. Next year they're not going to have that free ticket."

What means "Xbox not going to have free ticket"? It is regarding what exactly?

 

[Gediminas]

Found this post on Era regarding Xbox financial reports :
"Numbers are pretty bad overall and the only numbers that look somewhat decent are because of the ABK acquisition. Next year they're not going to have that free ticket."

What means "Xbox not going to have free ticket"? It is regarding what exactly?

ABK in those earning calls.