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Microsoft posts $21.7B revenue for third quarter, Xbox sales decline

Michael McWhertor is a journalist with more than 17 years of experience covering video games, technology, movies, TV, and entertainment.

Microsoft posted earnings for its third quarter today, announcing $21.7 billion in revenue for the three-month period that ended March 31, 2015, and net income of $4.99 billion. While revenue was up slightly, compared to the same quarter last year, net income was down. On the Xbox side, Microsoft said sales of its consoles and other computing and gaming hardware were down.

The company sold 1.6 million Xbox consoles during the quarter, down from 2 million the same quarter in 2014. Microsoft said Xbox platform revenue decreased $306 million for the quarter, driven by a "decline in console volume and lower prices of Xbox One consoles compared to the prior year." Microsoft dropped the price of Xbox One back down to $349 in January after a holiday promotion.

While overall computing and gaming hardware revenue was down $72 million for the quarter, the decline in Xbox revenues was partially offset by Surface sales, Microsoft said.

For the nine months of Microsoft's current fiscal year, the company said Xbox platform revenue was down $471 million compared to the same period last year. During the first nine months of fiscal year 2015, Microsoft said it sold 10.7 million Xbox consoles, compared to 10.6 million from the same period last year.

Despite declining quarterly sales and lower revenue, Microsoft highlighted Xbox Live usage in a press release. "Xbox Live usage grew over 30 percent, driven by increased users and deeper user engagement," the company said.

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