Business · Companies · 1 hr ago
Xbox hardware sales fall 14% as Asha Sharma cites supply limits
Xbox hardware sales fell 14% year on year in Microsoft’s latest quarterly results, covering the three months to September 30, 2026.
Xbox chief Asha Sharma said demand for consoles exceeds available supply and sales remain limited by how many consoles Microsoft can provide.
Overall Xbox revenue fell 2%, an improvement on the 10% decline the previous quarter.
Microsoft said lower revenue from third-party games and Game Pass partly offset growth in its own games.
Sharma pointed to strong results for Minecraft and World of Warcraft, as well as double-digit revenue growth on PC.
The company is expanding its console refurbishment program to get more devices to players.
The figures come as Xbox enters the holiday season, when Microsoft expects new releases including Call of Duty: Modern Warfare 4 and Grand Theft Auto 6 to contribute to results in the current quarter.
Xbox hardware sales fell 14% year on year in Microsoft’s latest reported quarter.
Xbox CEO Asha Sharma said console sales remained constrained by supply, with more demand than consoles available.
Xbox revenue declined 2% year on year, an improvement on the 10% decline in the previous quarter.
Sharma said Microsoft was expanding its refurbishment program to get more consoles to players.
Some observers questioned whether supply shortages explain the sales decline, noting that consoles could be bought in the United States.
- Who
- Microsoft’s Xbox division, led by CEO Asha Sharma.
- What
- Xbox hardware sales fell 14% year on year. Sharma said console sales were constrained by supply.
- When
- Microsoft’s FY27 first quarter, covering the three months ending September 30, 2026. Results were reported on October 28.
- Where
- Not stated. Sharma did not specify which markets faced supply constraints.
- Why
- Microsoft attributed the hardware decline to a lower volume of consoles sold. Sharma said supply constraints limited sales.
Xbox and Asha Sharma
Supply-constraint skeptics
Reason for hardware performance
Xbox and Asha Sharma
Sharma said console sales remain constrained by supply, with more demand than consoles available.
Supply-constraint skeptics
Skeptics said consoles were available from US retailers and questioned whether stock was the main cause of weak sales.
Evidence cited
Xbox and Asha Sharma
Sharma said Microsoft was working to get more consoles to players, including through an expanded refurbishment program.
Supply-constraint skeptics
Mat Piscatella said data he had seen did not suggest stock was the biggest driver of Xbox hardware performance.
Xbox hardware sales fell 14% year on year during Microsoft’s FY27 first quarter.
Sharma posted that Xbox revenue had declined 2% year on year and that console sales remained constrained by supply.
News outlets reported Microsoft’s results and Sharma’s comments.
- Xbox hardware sales
- Down 14% year on year
- Xbox revenue
- Down 2% year on year in FY27 Q1
- Previous-quarter Xbox revenue
- Down 10%
- Reporting period
- Three months ending September 30, 2026
- Refurbishment program
- Microsoft said it was expanding the program to increase the number of consoles reaching players
4 sources
Xbox CEO Says Xbox Series X|S Is Supply Constrained, But Is It?
Xbox Says There’s ‘More Demand Than Consoles Available’ As Hardware Sales Continue To Fall
Xbox leader Asha Sharma says there's "more demand than consoles available" as Xbox hardware sales dip by 14%
Asha Sharma Insists There's 'More Demand Than Consoles Available' as Xbox Hardware Sales Continue to Plummet
What people are saying
Console sales remain constrained by supply
We’re making progress, with a lot more work ahead.
the data I’ve seen do not suggest that stock has been the biggest driver of Xbox hardware performance.
Posts on X
In Q1, XBOX revenue declined 2% YoY, compared with a 10% decline a quarter ago, while our accountability margin improved. Minecraft and WoW Forever set records, Call of Duty had its most acclaimed release in more than a decade, and our PC platform revenue grew double digits.