Microsoft’s Q1 2018 Earnings: Xbox Service revenue up 21% in stagnant hardware market

Microsoft just announced their FY Q1 2018 earnings and as per usual they did not announce exactly how many consoles they sold.

What they did reveal however was that revenue from their gaming service was mostly flat, with hardware sales slumping even more, while Xbox software and services compensating with strong growth.

Microsoft writes that Gaming revenue increased 1% (0% in constant currency) with Xbox software and services revenue growth of 21% (up 20% in constant currency) offset by lower hardware revenue

Xbox Live active users grew 13% YoY to 53 million users, with growth across Xbox One, Windows 10 and mobile platforms.

Gaming revenue reached $1,896 billion, nearly the same as a year ago, but that quarter was notably boosted by the release of the Xbox One S, which briefly outsold the Playstation 4.

Revenue should once again be boosted in the holiday season by the release of the Xbox One X, the most powerful console in the world.

Microsoft reported revenue of $24.5 billion (up 12%), operating income of  $7.7 billion (up 15%), net income of $6.6 billion (up 16%) and earnings diluted earnings per share of $0.84, up 17% YoY and beating analyst expectations handily.

You can find the full report here.