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Microsoft’s Xbox sales down despite hot holiday period

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Xbox One

Microsoft has just announced its earnings for the last financial quarter, showing a mixed period for the Redmond-based tech giant.

Revenue rose 8 per cent to $26.5 billion (around £17.5bn) during the quarter, but Microsoft’s net profit’s fell 10 per cent to $5.8 billion (about £3.8bn) compared to the same period last year.

Somewhat surprisingly after becoming the best selling console during the holiday period, revenue was down 20 per cent in the Xbox division.

During the three months that ended on December 31, the company sold 6.6m Xbox One and Xbox 360 consoles compared with the 7.4m shipped during the corresponding period in 2013.

Microsoft earned a big sales boost by selling the console cheaper without the Kinect sensor, as well as offering a Christmas price cut (which has now become permanent), but it wasn’t enough to oust last years total console sales.

It is, of course, likely Microsoft sold considerably less Xbox 360 consoles than last year, while Xbox One sales were well up, but one would expect the total number to top last year, given the firm's fine performance over Christmas.

Elsewhere there was better news for Microsoft in the mobile sector. For the first time Lumia phones broke 10 million sales in a single quarter.

10.5 million of them were shipped in the final three months of the year, with Microsoft saying the growth can be attributed primarily to its range of budget smartphones.

In terms of the Surface tablet range, the company brought in revenue of $1.1 billion (around £729m) in sales, which was up 24 per cent on the previous year.

Microsoft says that gain is mainly due to sales of the impressive Surface Pro 3 and range of accessories. The company isn’t giving anything away with regards to Surface sales, but it seems safe to assume good progress is being made on that front.

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Overall it seems like a decent few months for Microsoft, given its profit fall can be largely attributed to its recent streamlining efforts and its attempts to integrate the mobile phone business since it was acquired from Nokia last year.

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