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Xbox hardware revenue fell 30% in Q3 2023 compared to the prior year

Xbox console sales were down significantly in Microsoft's latest financial quarter.

Donovan Erskine

April 25, 2023 2:40 PM

Microsoft

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Microsoft’s Q3 2023 earnings report provided insight into the company’s financial performance over the past few months. While it primarily focused on the company at large and some of its major products and services, there was a small sliver of information about its gaming division, also known as Xbox. It was bad news for Xbox, though, as hardware sales were reported to be down 30 percent compared to last year.

On slide 13 of Microsoft’s Q3 2023 earnings presentation, the company highlights its gaming division’s performance over the latest quarter. It’s here we see that gaming hardware revenue, which is essentially Xbox console sales, was down by 30 percent in comparison to Q3 2022. Microsoft attributes this sharp decline to the fact that the previous year “benefitted from increased console supply.”

The Xbox Series X and Xbox Series S are the Microsoft gaming hardware in question. Released simultaneously in November 2021, the new systems flew off shelves and were hard to come by as Microsoft struggled to produce enough units to meet demands. Since then, production rates have increased, but sales numbers have decreased over the latest period.

With the presence of Xbox Game Pass and all of Microsoft’s first-party games on PC, many have speculated how that may impact the sale of Xbox consoles. There’s no concrete information about the PC userbase in this report, but it’s something to keep in mind as we get further into this console generation.

Xbox’s hardware sales numbers were just a piece of the information found in Microsoft’s Q3 2023 earnings report, which also showed that the company beat both earning and revenue expectations. If you’re looking for all the other financial news dropping in the tech and gaming worlds this week, Shacknews has the details.

Donovan Erskine

News Editor

Donovan is a journalist from Maryland. His oldest gaming memory is playing Pajama Sam on his mom's desktop during weekends. Pokémon Emerald, Halo 2, and the original Star Wars Battlefront 2 were some of the most influential titles in awakening his love for video games. After interning for Shacknews throughout college, Donovan graduated from Bowie State University in 2020 with a major in broadcast journalism and joined the team full-time. He is a huge film fanatic and will talk with you about movies and games all day. You can follow him on twitter @Donimals_