According to Microsoft Gaming CEO Phil Spencer, Microsoft loses as much as $200 on every Xbox it sells. According to CNBC's writeup of a recent WSJ Tech Live event, Spencer disclosed that Microsoft subsidizes the production cost of a new Xbox by about $100 to $200 per console.
There was some confusion about Spencer's comments, and Microsoft followed up with GameSpot to send through exactly what Spencer said during the event. He said:
"Consoles as a business model, in the overall scope of gaming, is fairly small relative to the places people play. Consoles evolved to a business model much different from phones where consoles are actually sold at a loss in the market. So when somebody goes and they buy an Xbox at their local retailer we're subsidizing that purchase somewhere between a hundred and two hundred dollars, with the expectation that we will recoup that investment over time through accessory sales and storefront."
Continue Reading at GameSpot November 02, 2022 at 02:33PM