The landmark Apple v. Epic Games court case has turned into a fascinating case thanks to all the info that keeps coming out of court documents and testimonies. Today, Microsoft VP Lori Wright was called to testify in court and finally confirmed what many within the industry have suspected all along – gaming console hardware sells at a loss…unless it’s Nintendo.
Microsoft VP Lori Wright is the head of business development at Xbox. She’s been a key witness called by both sides and during her testimony today, she was asked directly about the Xbox business model. Given the fact that she’s providing testimony, Wright provided candid answers.
When asked how much does Microsoft make on the sale of an Xbox console, Wright offered a succinct answer: “we don’t.” Many suspected that console manufacturers sold the hardware at a loss as the business plan is to generate long-term spending on game sales and subscriptions. This has only become more apparent due to the rise of digital sales and the emergence of subscriptions such as Xbox Game Pass. When pressed if Microsoft had ever made a profit on Xbox hardware, Wright answered “no.”
Court documents made available to the public confirmed as much. The documents also show that Microsoft project Sony similarly make a loss on PlayStation hardware. Nintendo, however, are projected to be selling their hardware at a profit.