While it's easy to compare Microsoft to Sony or Xbox to PlayStation, what fans should really be doing is comparing those things to themselves. Althought the ire of the console wars has definitely died down since the PS3/Xbox 360 era, fans still put a lot more stock in it than Sony or Microsoft. These big companies know that they are successful, and they measure that success against their own previous accomplishments rather than against a competitor. A recent financial report from Microsoft shows this in action, as it is revealed that Microsoft made $3.5 billion in Q1 2021.
There are a number of reasons why Microsoft is doing so well this year, but it may surprise fans to hear that it isn't all thanks to the recent release of the Xbox Series X. That is definitely a major part of the accomplishment, but several other factors also come into play and make this impressive sales record possible.
According to analyst Daniel Ahmad, "this would be the best Q1 (FY Q3) for Microsoft's gaming division since they started breaking out numbers about six years ago." In the report, he acknowledges that most of the growth from hardware sales can be attributed to the release of the Xbox Series X, but strong game sales and services are a huge part of the achievement. Ahmad takes extra care to point out that Game Pass is growing at an incredible rate and bringing in a lot of money for Microsoft's gaming division.
Another interesting factoid to come from this report is that content and services still make up 80% of the total revenue for Xbox despite the next generation consoles launching in November. It's entirely possible that console sales would be even higher if the supply was able to meet the demand, but that is just speculation. All in all, this represents an incredibly successful start to 2021 for Microsoft, and it seems highly likely that this success will continue on throughout the rest of the year as Game Pass continues growing and more players get their hands on an Xbox Series X.
In the comments to Ahmad's tweet, many players are curious about whether or not this includes numbers from Microsoft's acquisition of Bethesda (ZeniMax). Since that acquisition wasn't finalized until recently, it wouldn't show up in the data for the first quarter. Instead, players might expect to see some changes in the next quarter's report. Still, it will be tough for Microsoft to top this impressive report.