Xbox leader Asha Sharma says there’s ‘more demand than consoles available’ as Xbox hardware sales fall 14%

Xbox leader Asha Sharma claimed that there is “more demand than consoles available” when it comes to Xbox, and that console sales “remain constrained by supply.”

She was speaking after Microsoft announced its quarterly financial results yesterday, in which Xbox revenue fell 2% year-over-year. The financial data also revealed a decline in Xbox hardware sales, which are down 14% year-over-year, due to a “decline in the volume of consoles sold.”

Sharma’s positive take, which she posted on X, highlighted the record-breaking performances of Minecraft and World of Warcraft: Forever, and applauded Call of Duty’s “most acclaimed release in over a decade.” It also reported double-digit PC revenue growth.

“Console sales remain supply constrained,” Sharma added, “with demand outstripping the number of consoles available. We’re working to get more consoles into the hands of gamers, including through our expanded refurbishment program. We’re making progress, with much more work to do.”

In Microsoft’s earnings call, transcribed by Seeking Alpha, company boss Satya Nadella also celebrated the “record quarter” of Minecraft and World of Warcraft having “its largest beta in franchise history.” Additionally, Nadella highlighted “one of our strongest first and third (holiday) product lines in years,” citing COD Modern Warfare 4 and GTA 6 as two of the reasons why. But there’s no mention of Gears of War: E-Day, which, with an October 6 release date, falls during this holiday period.

Amy Hood, Microsoft’s chief financial officer, added a bit more detail, noting that the decline in Xbox revenue was “driven by declines in third-party content and Xbox Game Pass, partially offset by growth in first-party content.”

These Xbox results come shortly after Asha Sharma said the Xbox division had “started to return to growth” following its drastic restructuring, which has resulted in more than 1,800 job cuts so far. This restructuring work is also in progress, with other waves of layoffs expected soon and while Microsoft is more widely offering voluntary departure to several thousand employees.

However, overall, Microsoft appears to be thriving as a company, with its cloud services in particular generating notable gains in revenue and profits. But it is these cloud services that are also behind calls to boycott the company’s products, due to their use by the Israeli military in the ongoing enslavement and genocide of Palestinians. It’s a connection that recently led Big Walk developer House House to refuse to sell its game on Xbox.