Microsoft loses up to $200 on every Xbox console they sell

Video game consoles are expensive pieces of computer hardware crammed into relatively small boxes and packed with expensive consoles. So it’s no surprise to hear that Microsoft doesn’t make money selling Xbox consoles. In fact, these days, you lose up to $200 per console sold.

Previously, the head of Xbox and head of Microsoft’s gaming division, Phil Spencer, explained that the company may continue to raise prices on “a few things,” Although not during this holiday season. While many were guessing he was talking about Game Pass or Xbox Live, it’s also possible that Microsoft will raise the price of the budget console, the next generation Xbox Series S. That seems even more possible now that Spencer has confirmed that the company is losing money on every console. . Sold.

In a recent interview with CNBCSpencer spoke about the performance of video games and the Xbox brand specifically during the ongoing economic downturn. High prices and record inflation Put a pinch on a lot, as the dollars don’t go as far as they used to be. During the interview, Spencer confirmed that Microsoft loses about $100 every time they sell a $500 Xbox Series X. And you lose even more, up to $200, when you sell your Xbox Series S.

Spencer said CNBC Microsoft expects that customers will buy supported consoles and then buy accessories and games, helping to offset the losses. While Spencer hasn’t said anything about raising prices on any of the next-gen Xbox consoles, he did tell CNBC He doesn’t think Microsoft will be able to keep game prices fixed forever. We have already seen Rise of the $70 game Since the launch of the PS5 and Xbox Series X/S. Microsoft has not yet released a $70 game, but it looks like future releases like Redvale or starfield It might make the jump.

Of course, selling consoles at a loss is not a new practice. Microsoft itself told the court during the Epic v. Apple she had She didn’t make a profit selling any of her Xbox consoles. Reportedly, Sony is also PS3 Sold For $240 Loss. The only real exception to all of this is Nintendo, where the company behind the Switch and Wii tends to make money off of its consoles. even if Nintendo earns only $6 per WiiThis is much better than losing hundreds of dollars per unit sold. Meanwhile, Sony has PS5 price hike in some parts of the world.