As Microsoft transitions from the Xbox 360 to the Xbox One, the company's digital revenue is growing ahead of the next console generation while Xbox 360 revenue is dropping.
Revenue in Microsoft's fourth fiscal quarter for its Entertainment and Devices Division, which includes all things Xbox, was up $134 million, or 8 percent, over the same period in 2012, the company said in its fourth-quarter and full-year fiscal 2013 results today. Xbox 360 platform revenue decreased, but that was offset by improved Windows Phone performance in the Entertainment and Devices sector.
Over the course of the fourth quarter, which ended June 30, Microsoft's revenue from Xbox Live transactions grew by 20 percent. The company also shipped fewer Xbox 360 units in the quarter — 1 million in 2013 versus 1.1 million last year.
Microsoft's overall revenue for the fourth quarter was up 10 percent year over year, and revenue for the full year grew by 6 percent. The company recorded a major improvement in net income: $4.97 billion of income this year, versus a $492 million loss for Q4 2012. For the full year, the company's net income rose from $16.98 billion to $21.86 billion, a 28.8 percent jump.
The division-based structure mentioned above won't exist in the future at Microsoft — CEO Steve Ballmer announced a major reorganization a week ago. The "One Microsoft" strategy restructures the company around devices and services, with former Windows co-chief Julie Larson-Green now leading the Xbox hardware division.