11.2 million Xbox 360s shipped in FY09

By Ellie Gibson Published 24 July, 2009

But sales down in the last few months.

Microsoft shipped 11.2 million Xbox 360 units over the course of the last financial year.

That's more than in 2008 - back then the figure was 8.7 million. Console sales and Xbox Live revenues were also up.

However, 360 and PC gaming revenues were down by $161 million, or 3 per cent. Microsoft's financial report puts the drop down to Xbox 360 price cuts.

Overall revenue for the Entertainment and Devices Division (which covers PC gaming, 360, Zune and Mediaroom) was down by 5.6 per cent ($453 million). Operating income fell 66 per cent ($328 million).

In the last quarter alone, gaming revenues were down by 12 per cent ($110 million), "primarily as a result of decreased Xbox 360 console sales" and again, price cuts. A rise in Xbox Live revenues helped to make up for it though, as did the fact the company spent 30 per cent less on marketing - that's $107 million worth of Xbox 360-branded beachballs.

Microsoft Corp.'s total profit dropped by 18 per cent to reach $14.57 billion for the year. In the last quarter, profits stood at $3.09 - a fall of 29 per cent.

Picture of Ellie.

About Ellie Gibson

Since joining Eurogamer in the mid 2000s, Ellie has written about subjects as diverse as the fall of Gizmondo, the rise of Hollyoaks actresses in Red Alert games and the noise a bear makes under NSFW circumstances.

Read more articles from Ellie by visiting the Ellie Gibson archive page.

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Comments (37) Latest comment 3 years ago

Comments for this article are now closed, but please feel free to continue chatting on the forum!

  • Vice.Destroyer #1 3 years ago

    I obviously don't keep up with these figures. Any EG'er want to tell me what the lifetime shipped figures are for the 360?

  • Petulant_Radish #2 3 years ago

    Surely a drop from 14billion dollars to three dollars and nine cents is more than a 29 percent drop? That's catastrophic, has no one told Bill that Steve is ruining his beloved company?

    *Note to self, whilst in pedant mode please ensure all witticisms are free from typos. thank you.*
    Edited by Petulant_Radish at 24/07/09 @ 09:27

  • Dizzy #3 3 years ago

    >lifetime shipped figures are for the 360?

    About 30 million.

    3$ profit!!! Woah ;)

    Anyway... still quite a luxury position to pull in a lot of profit. A lot of companies would kill for this kind of numbers.
    Edited by Dizzy at 24/07/09 @ 09:28

  • Bealsy #4 3 years ago

    MS only made $3.09 in the first quarter? That's not very impressive.

  • rotmm #5 3 years ago

    @Vice - 31.59m

  • IneptPercy #6 3 years ago

    Any profit is better than a loss.

  • matrim83 #7 3 years ago

    I made more money than MS in the first quarter. \o/

  • rotmm #8 3 years ago

    Quite impressive by Ellie. Not only did she forget to put the billion at the end of the $3.09, she also managed to wipe off $90 million from MS's bottom line in a single stroke, from $3.99 billion.

    With this, along with posting invisible stories yesterday at about the same time, it's pretty clear that Ellie is not a morning person ;)
    Edited by rotmm at 24/07/09 @ 10:00

  • JahB #9 3 years ago

    @donnie

    as dumb as the rest of your post is, the terminator reference made me laugh

  • El-Dev #10 3 years ago

    Have MS made a profit yet from the XBox division? These figures aren't very clear on that. I wouldn't guess so when you include extended warranties that led to over $0.5bn being written off.

  • BillyBrush #11 3 years ago

    @El Dev

    probably not, but tbh it doesn't matter THAT much if the company is raking in a few bil, and sitting on a fair few billion in the bank, it lets them continue to play this game called 'concole warz'

    selling more than you did the year before, is a good thing, price cuts or not

  • El-Dev #12 3 years ago

    "selling more than you did the year before, is a good thing, price cuts or not"

    Selling more is good, but selling more AND making less profit is not a good thing, in fact it's a bad thing. But at least they know the reasoning behind it, it would be worrying if they didn't.

    So far it appears that nintendo are the only company with a good business model.

    "they will not stop untill sony is dead. "
    That type of business policy is illegal.
    Edited by El-Dev at 24/07/09 @ 10:43

  • KidCactus #13 3 years ago

    "Revenue from our Entertainment and Devices Division decreased across most lines of business including Xbox 360 platform and PC game revenue which declined primarily as a result of decreased console sales and revenue per console due to price reductions during the past 12 months, partially offset by increased Xbox Live revenue."

    So they sold less consoles and made less money on each console due to price cuts? Something to pick up for all those complaining about Sony not slashing their prices on the PS3.
    Edited by KidCactus at 24/07/09 @ 10:47

  • El-Dev #14 3 years ago

    "on the subject of overall profit, they have been making money of 360/LIVE ETC for a year or so "

    No, they haven't. The $0.5bn was in relation to the 360. Overall on the 360 they will make a profit probably in the next 2-3 years. Especially if their turnover for the division remains the same.

  • El-Dev #15 3 years ago

    They have reported operating profits from the 360 that did not include the $0.5bn written off for extended warranties and repairs. Which means no profit yet from the division.
    Edited by El-Dev at 24/07/09 @ 11:19

  • El-Dev #16 3 years ago

    "i know but their goal is market share the first 3 years or so."

    If that is the case then it hasn't been the roaring success you think. Despite being a hell of a lot cheaper than the PS3 they haven't really pulled that far away and they are still very far behind the Wii. In comparison the PS3 has sold more in the 2 years after launch than the 360 did in it's first 2 years. I think the PS3 sold 20m in comparison to the 360s 18m, despite the price gap.

    As I have said, the best business model is the Wii, the only real success so far this gen.

  • GreyBeard #17 3 years ago

    What El-Dev writes is factually correct about MS performance with 360, and no number of rate-downs is going to change that.

  • Darren #18 3 years ago

    @donnie080208 - I very much doubt that Microsoft will shift another 70 million Xbox 360s over the next four years. The only console (not including handhelds) currently likely to achieve that is the Nintendo Wii in my opinion. I don't think either the Xbox 360 or the PS3 will reach 100 million units sold myself not unless they're on sale for longer than 10 years.

    I'm betting we'll see a new Xbox inside four years anyway and that's likely to move attention away from the 360. If demand for the Xbox 360 is already falling as this article suggests then Microsoft will choose to introduce its successor sooner rather than later.

  • rotmm #19 3 years ago

    @El-Dev,

    Roaring success, no. But it's all relative. The PS3 was sold on the back of the amazing sucesses of the PS1 and PS2 and therefore was targeting that ready-made user base. The 360 was sold on the back of the comparable failure of the Xbox and was, in effect, starting afresh.

    So the PS3 has, so far, failed to live up to expectations, whereas the 360 has surpassed them.

    Nintendo, has of course, ruled the roost though. Which I don't believe that many saw coming.

  • peterfll #20 3 years ago

    "That combined with the recent stroppy articles.. she's either with child or an alchoholic".

    Interesting isn't it how only Ellie picks up these sorts of comments. Sexism - clearly dead on the tinternet.

  • Petulant_Radish #21 3 years ago

    El-Dev, do you understand what ‘written off’ means? That means they do not include that on their balance sheets, it is something which they effectively take on the chin from the whole company, not just the Xbox division, and as such means they can post profit from that division without ever having to reference to 500million because in accounting terms they do not have to.

  • charming_fox #22 3 years ago

    From where I sit Ellie tends to ask the right questions but includes far too many cock, sex and nudity jokes. I just want to read about games and the industry. I eat peas and carrots regularly
    Edited by charming_fox at 24/07/09 @ 12:05

  • El-Dev #23 3 years ago

    Petulant, yes I do indeed understand as I study Accountancy at Uni. My point is that I find it amusing how they talk about profits from the 360 when the reality is that the profit only comes by writting off $0.5bn. They really aren't making a profit yet as this is part of the costs of manufacturing and supplying the 360 despite how it's dealt with in the financial reports.

    just because they don't have to reference it in their accounts doesn't mean it hasn't really happened.
    Edited by El-Dev at 24/07/09 @ 12:10

  • Petulant_Radish #24 3 years ago

    But then you should realise that in business terms they are posting a profit, and a profit they are making. That 500million has been written off, absorbed by the company as a whole, as the company was able to do this then they are fully within their rights to post a profit on their publicly listed business sheets, and that’s what truly matters, what is posted to the shareholders.

    Cheating it may be, but it’s a cheating they are within their rights to do an as such they are making a profit from the Xbox division.

    All of this is neither here nor there really because why should we actually care if they post a profit or not, it does not affect you or me personally so who gives a poo poo.

  • El-Dev #25 3 years ago

    Posting a profit and making a profit, bit of a difference. Ask Enron.

  • Penguinzoot #26 3 years ago

    I'm betting we'll see a new Xbox inside four years anyway and that's likely to move attention away from the 360. If demand for the Xbox 360 is already falling as this article suggests then Microsoft will choose to introduce its successor sooner rather than later.

    Darren, at one time I would have agreed with you. After all Peter Moore did originally say that the expected lifecycle for the 360 was 6-8 years - which of course did not preclude a successor appearing within that timeframe. However with Natal things may have changed. MS definitely seem to be talking up a longer lifecycle for the 360 lately, with the extra "legs" being supplied by Natal itself. If Natal takes off, it does present MS with an opportunity to do this.

  • Petulant_Radish #27 3 years ago

    Enron lied, Microsoft are not lying. There is a huge gulf between the two, and Microsoft definitely have the money to cover any shortfall, at least they tell us they do…wait a minute…ahaaaaaaaaaaa. No I don’t care really, I’m off to the pub, bye.

  • makeamazing #28 3 years ago

    Not good news for MS, but as others have said its still a profit. Also with Windows 7 coming out, they are going to make alot more than they did with Vista, so that should increase profits alot.

  • ronuds #29 3 years ago

    What is this .5bn we're talking about?

  • BillyBrush #30 3 years ago

    Sorry, but it does not take any kind of accountancy skills to work out that Microsoft, and Sony want to sell videogames consoles whether thay put them out at a loss or not....in fact it's pretty fucking obvious that they put them out at a loss precisely so they can sell more....this should be obvious but is clearly not

  • BillyBrush #31 3 years ago

    It's sometimes called, building market share

    and this market is quite valuable.

  • Machiavellian #32 3 years ago

    Maybe it's me but do any of you understand that the Entertainment division is made up of more than the Xbox division. It has the Zune, MS Mobile, SetTop and devices etc. You all do understand that A lot of money has been invested into Natal, and the Zune HD not including the service etc. You cannot extrapolate how much the 360 has profited or not by this report since no one knows exactly what investment, charges to the division were XBox related, Zune, MS Mobile (which has spent a lot of money redesigning their OS) etc. The only thing you know is that the division as a whole made less profit this year than last year.

    Also for El-Dev
    You say you are taking accounting but it seems you must be in the early stage of your course or you would not be making such a big deal about the 0.5billion (I thought it was over a billion) that MS wrote off for the warranty service on the 360. People have already told you that when a company write off a lose like that the whole company take the hit and its a hit on that Fiscal year. Also when you write off a lost like that, the Government gives you a break on your taxes. In other words, because of the write off, MS was able to save money on the taxes they pay and thus cut the amount of the lost hit to their pockets. I will not go into a lot of corporate Accounting with you but I can assure you that after MS accountants finished with the books, that lost was absorbed and barely hit MS as a company.

  • subtlesnake #33 3 years ago

    "Petulant, yes I do indeed understand as I study Accountancy at Uni. My point is that I find it amusing how they talk about profits from the 360 when the reality is that the profit only comes by writting off $0.5bn. They really aren't making a profit yet as this is part of the costs of manufacturing and supplying the 360 despite how it's dealt with in the financial reports.

    just because they don't have to reference it in their accounts doesn't mean it hasn't really happened."

    The amount written off was $1 billion, which is the estimated cost of servicing the warranty over the 360's lifespan. We don't know what that works out at on a per year basis, so we're not in a position to say whether Microsoft are currently making a profit once warranty repair costs have been included.

    In any case, it really doesn't matter overall, because (if Microsoft's warranty cost estimations are correct) we're looking at around $3 billion of investment that Microsoft need to get back to break even ($2 billion in losses over the first 2 years of the 360's life + the $1 billion warranty surcharge).

    Over the last two financial years, running from July 2007 - July 2008, and July 2008 - July 2009, they've made profits of $426 million and $169 million respectively, which adds up to $595 million. So if they continue their current momentum they're well in a position to pay off the warranty charge, and start making the other part of their investment back.

  • smelly #34 3 years ago

    oooh oooh OOOH!!!

    This is GREAT news.. I love my 360.. This is the bestest thing i've ever read. I'm masturbating while i type this.

    I *REALLY* care about how many consoles have been shipped! My life DEPENDS on it... knowing i have a machine which is selling lots makes me feel popular (because i dont actually have any friends)

  • El-Dev #35 3 years ago

    "You say you are taking accounting but it seems you must be in the early stage of your course or you would not be making such a big deal about the 0.5billion (I thought it was over a billion) that MS wrote off for the warranty service on the 360. People have already told you that when a company write off a lose like that the whole company take the hit and its a hit on that Fiscal year. Also when you write off a lost like that, the Government gives you a break on your taxes. In other words, because of the write off, MS was able to save money on the taxes they pay and thus cut the amount of the lost hit to their pockets. I will not go into a lot of corporate Accounting with you but I can assure you that after MS accountants finished with the books, that lost was absorbed and barely hit MS as a company. "

    Point thouroughly missed.

    They are selling well and claiming a profit, but despite what the financial reports say they haven't made money yet from the 360. Financial reports and what really happens are 2 different things. Taking the hit on one year means it looks bad for that one year, but the next year it doesn't look as bad as the loss has already been accounted for, when the reality is you're still not close to covering the loss you have had to pay off in the previous year. That's looking at it in an over all business perspective and not just a financial accounting stand point.

    Yes the $0.5bn isn't really a lot for MS but it should be considered for the games division when people want to run around singing their praises.

    "Over the last two financial years, running from July 2007 - July 2008, and July 2008 - July 2009, they've made profits of $426 million and $169 million respectively, which adds up to $595 million. So if they continue their current momentum they're well in a position to pay off the warranty charge, and start making the other part of their investment back. "

    So basically what I am saying, no profit has been made yet. Despite the financial reports claiming it has. It would be good if they could at least make enough from the console to pay the warranty back, how long will Bill Gates want to throw billions down what could be a deeper drain than expected.

  • subtlesnake #36 3 years ago

    "So basically what I am saying, no profit has been made yet. Despite the financial reports claiming it has. It would be good if they could at least make enough from the console to pay the warranty back, how long will Bill Gates want to throw billions down what could be a deeper drain than expected."

    Well, there are two different things here: there's the return on investment for the project as a whole: i.e they put in $3 billion, how much of that will they get back?, and the operating profits, i.e their operating revenues minus operating costs.
    The distinction is important because if they're making an operating profit, then their return on investment is increasing and eventually they stand the chance of breaking even, while if they're making an operating loss, then the hole is only growing bigger. So when people say Microsoft is making a profit, they're not saying Microsoft have made back their investment (i.e their past losses) they're saying Microsoft have reached a point where their quarterly revenue exceeds their quarterly costs.

    This is the case, discounting warranty charges. Now we don't know what these costs actually are: all we know is Microsoft has set aside $1 billion (not $0.5 billion) to cover them, so despite what you say, we can't conclude that Microsoft in the strictest sense is making a loss. If the warranty costs are $165 million a year, for example then Microsoft made $261 million of profit in the 2008 financial year and $4 million of profit in the 2009 financial year, against a now smaller $2 billion investment.

  • BillyBrush #37 3 years ago

    @El Dev

    how long will Bill Gates want to throw billions down what could be a deeper drain than expected.

    Fair enough

    how long will Howard Stringer want to throw billions down what could be a deeper drain than expected?

    I think herin lies the battle, and I think MS knew full well it would be an expensive one