Xbox Made $2.25 Billion for Microsoft Last Quarter, Xbox Live Growth Less Impressive

Today, Microsoft announced its financial results for the third quarter of fiscal year 2018, which [...]


Today, Microsoft announced its financial results for the third quarter of fiscal year 2018, which ended on March 31st.

Microsoft's video game brand, Xbox, brought in a notable $2.25 billion in the quarter, which represented an 18 percent year-on-year growth from the $1.91 billion posted in Q3 2017.

Continuing the trend of not disclosing console sale numbers (which is normal for the "losing" console), Microsoft focused on Xbox Live users and numbers on the software front.

As of Q3 2018, Xbox Live is 59 million monthly active players strong, which is up 13 percent from the 52 million during the same period last year. Compared to Q2 2018, the increase rate is even. While 13 percent seems like healthy growth, when you put it into the context that only seven million new Xbox Live users were gathered over the course of a year, it's less impressive. That's less than a million new users a month.

It's important to note that new Xbox Live users doesn't translate to consoles sold, because many people buy hardware without dabbling in the online services they offer. However, given the record-breaking year Call of Duty: WWII had and the new battle-royale phenomena represented in Fortnite and PlayerUnknown's Battlegrounds, seven million new Xbox Live users isn't exactly great. Presumably, the players playing these games were already signed up, or taken by another system.

The seven million further includes new Xbox Live users collected from other Microsoft devices, such as its mobile phones. So again, not great, but double-digit growth is still double-digit growth, so Microsoft is probably pretty happy.

Gaming revenue growth for Microsoft was apparently driven mostly by a 24% growth of revenue generated by Xbox software and services, which according to Microsoft, was a result of a strong showing of third-party games.

Interestingly, the investor call also revealed that the company's operating expenses grew five percent during the last quarter, and this increase predominantly comes off the back of further investments in gaming says Microsoft.

Elsewhere in the call, Microsoft talked about its expansion into cloud gaming and services, something it has been talking up for quite awhile.

With healthy growth for the Xbox brand and increased investment from Microsoft, the coming years should be exciting for Xbox One. Hopefully that excitement will be kicked off this June at E3 2018.