The Xbox Series X/S consoles are sold at a loss of up to $200 per console[1][2][3][5].
Microsoft subsidizes the sale of each console because it expects to make this back through game sales and subscriptions to Xbox Game Pass[1][2][3][5]. This is a common business practice in the gaming industry, as companies often sell consoles at a loss and recoup the money elsewhere, such as from software sales and subscriptions[2][4][5].
The loss is not because the hardware costs more than the retail, but because of the R&D costs and the forecasted sales[6]. Microsoft has never earned a profit from selling Xbox consoles, including the Xbox One, 360, and the original console[4].
I mean, that changes nothing about them now charging significantly more for a market where nothing has changed.
Also if they wanted to shift and be like ‘sold at true hardware price’ then they should stop charging for things like Xbox Live or taking such a cut from the developers for the ‘privilege’ of running on their console.
The Xbox Series X/S consoles are sold at a loss of up to $200 per console[1][2][3][5].
Microsoft subsidizes the sale of each console because it expects to make this back through game sales and subscriptions to Xbox Game Pass[1][2][3][5]. This is a common business practice in the gaming industry, as companies often sell consoles at a loss and recoup the money elsewhere, such as from software sales and subscriptions[2][4][5].
The loss is not because the hardware costs more than the retail, but because of the R&D costs and the forecasted sales[6]. Microsoft has never earned a profit from selling Xbox consoles, including the Xbox One, 360, and the original console[4].
Citations: [1] Xbox Series X Consoles Sold At A $200 Loss, Says Phil Spencer - TheGamer https://www.thegamer.com/xbox-series-x-s-sole-at-loss-200-dollars/ [2] Microsoft loses up to $200 on each Xbox console sold | Eurogamer.net https://www.eurogamer.net/microsoft-loses-up-to-200-on-each-xbox-console-sold [3] Phil Spencer Reveals How Much Xbox Loses With Each Console Sold - Game Rant https://gamerant.com/xbox-console-sales-losses/ [4] Microsoft Says Xbox Consoles Have Always Been Sold at a Loss - PCMag https://www.pcmag.com/news/microsoft-says-xbox-consoles-have-always-been-sold-at-a-loss [5] Microsoft takes a $100-$200 loss on all Xbox Series X|S sales - TrueAchievements https://www.trueachievements.com/n51690/phil-spencer-xbox-series-x-s-loses [6] Microsoft takes a $100-$200 loss on all Xbox Series X|S sales : r/XboxSeriesX - Reddit https://www.reddit.com/r/XboxSeriesX/comments/yj7b3b/microsoft_takes_a_100200_loss_on_all_xbox_series/
I mean, that changes nothing about them now charging significantly more for a market where nothing has changed.
Also if they wanted to shift and be like ‘sold at true hardware price’ then they should stop charging for things like Xbox Live or taking such a cut from the developers for the ‘privilege’ of running on their console.
It’s down to profit, it always is.