Microsoft Pushes Xbox Division to Hit Higher Profit Margins - Bloomberg
Microsoft Corp. is asking its Xbox gaming division to produce profit margins that are well above the industry average, ratcheting up pressure on its video-game makers during a difficult time for the field at large.
Over the past two years, executives at the Seattle-based software giant have set an across-the-board goal of 30% “accountability margins,” a term Microsoft uses in lieu of profit margins, according to people familiar with the business. The gaming division, which includes dozens of studios, has responded by canceling products, raising prices and slashing thousands of jobs, said the people, who asked not to be identified discussing nonpublic information.
The average profit margin in the video-game industry in recent years has ranged between 17% and 22%, according to estimates from S&P Global Market Intelligence, while coming in between 10% and 20% over the past six years at Xbox. Court documents from 2023 revealed that Microsoft’s gaming business had a 12% profit margin for the first nine months of the company’s 2022 fiscal year.
The new goal, which hasn’t been previously reported, is at the outer range of what a gaming studio can typically reach in a boom year, said Neil Barbour, an analyst with S&P Global. “A 30% or better margin is usually reserved for a publisher that is really nailing it,” Barbour said.
Nicio sansa sa ajunga la 30%, poate Microsoft cauta un motiv sa scape definitiv de Xbox.
Vor anunta un joc Halo nou saptamana aceasta:
Xbox’s best hope for a blockbuster game in recent years was 2021’s Halo Infinite, the latest entry in its most vital franchise. Despite some early accolades, the game was ultimately seen as a failure and led to a complete overhaul of the studio behind it. Later this week, Microsoft will announce a new Halo release in an attempt to resuscitate the franchise.