Around the holidays, Microsoft made headlines when it dropped the price of the Xbox One to $350. The decision paid off big time for Xbox as it created a huge leap in sales. However, after a strong run of increased sales, it looks like the Xbox One numbers are on the decline.

While reporting earnings today, Microsoft revealed that console sales are down 24 percent, leading to a revenue decrease of $306 million during Quarter 3 of the Fiscal Year 2015. In total, Microsoft sold 1.6 million Xbox One consoles during the quarter, which is still an impressive number but likely lower than expected.

While console sales have declined, Microsoft also announced the Xbox Live service increased by 30 percent, likely as a result of those strong Xbox One sales late last year. Microsoft stated that the increase in Xbox Live is “driven by increased users and deeper user engagement.”

The decrease in sales may sound like a bad omen for Xbox, but in reality Xbox One sales are doing well. Sales during the first three quarters of the company’s fiscal year were higher than the previous year's sales during the same period. Additionally, total console sales of all platforms for the period were significantly higher than the previous year.

We will note that Microsoft’s major sales influx during the holidays helped the Xbox One close the gap with the PlayStation 4 in the United States. While PlayStation 4 still outsells Xbox One worldwide by a sizeable, Xbox was able to get within 500,000 sales of the Sony console in the United States. However, that gap has again increased as Xbox sales have declined.

Based on the numbers, it seems the cut in price for the Xbox One was a successful strategy by Microsoft, and keeping the price down is sure to keep sales in a decent place. However, the price drop can’t be the only thing that drives strong sales, as Sony has shown with the PlayStation 4.

Now, it’s time for Microsoft to focus attention on other strategies to get Xbox One sales back up to where they were at the holidays. That will require heavy focus on exclusive games, including Halo 5, Fable Legends, and Quantum Break, all of which are expected to release in the next 12 months.

We’re also sure to see Microsoft ramp up attention on Xbox and Windows 10 integration. By bringing together all of Microsoft’s products and services, they’ll be able to provide a more immersive presence with gamers.

What do you think about Xbox One’s sales? Will lower sales hurt Microsoft? Let us know your thoughts in the comments.