Microsoft Revenue Surges on AI as Xbox Struggles

Xbox hardware sales fell 14 percent according to the company’s fourth-quarter earnings report released Wednesday. This contraction arrives shortly after Xbox head Asha Sharma initiated a strategic reset, which involved staff layoffs and the divestment of four game studios. To combat these losses, the company will increase console prices by at least $100 beginning August 1.

Contrasting this slump, Microsoft’s cloud business generated $59.3 billion, a 27 percent increase. Productivity and business processes, including Microsoft 365 and LinkedIn, rose 14 percent to $37.8 billion. The PC market also faced headwinds, as the Windows OEM and devices segment dropped 7 percent due to lower consumer demand.