Xbox is reportedly being pushed by parent company Microsoft to achieve profit margins far in excess of those towards which the rest of the industry aims, according to a new report.
As reported by Bloomberg (which, of course, cites "people familiar with the business"), Microsoft has set goals of 30% for Xbox's "accountability margins", which is apparently the term Microsoft uses instead of "profit margins". Start brushing up on those corpo-jargon dictionaries now.
Bloomberg reports that average industry profit margins sit between 17% and 22%. Xbox's have generally been lower than that over the past few years at between 10% and 20%, so this 30% profit goal is a massive jump even for Xbox, let alone for the rest of the industry.
S&P Global analyst Neil Barbour told Bloomberg that the 30% target is one "usually reserved for a publisher that is really nailing it". Given the controversy surrounding recent Game Pass changes, as well as project cancellations and layoffs, I'd say you'd struggle to apply that descriptor to Xbox right now.
Speaking of Game Pass, Bloomberg's sources say that Xbox's requirement for all first-party games to launch on Game Pass on day one "has hurt Xbox game sales"....
