Apple and Epic Games are in the middle of what is sure to be a long legal battle. During the court hearings, we saw companies cite different examples in the industry that support their given cases. As part of Epic Games’ testimony, the company brought in Xbox Vice President Lori Wright as a witness. While at the helm, Wright admitted that Microsoft made no profit selling Xbox consoles.
It was during the third day of the Apple vs Epic Games trial when the latter called Xbox Vice President Lori Wright as a witness. With Epic Games trying to prove Apple’s wrongdoing in the way it runs its App Store, the company has turned to other publishers who have faced the same policies. At the stand, Wright asked a series of questions. One of those questions was “Does Microsoft make a profit on the sale of an Xbox console?” To which Wright replied “No”.
In a follow-up question, the Xbox VP was asked why Microsoft continues to sell Xbox consoles if it doesn’t make a profit on them. Wright responded, saying “hardware is essential” to support an end-to-end user experience.
It has been heavily speculated that Microsoft is not making a profit on its console sales, given the price relative to the parts needed to make an Xbox. It would also highlight why the company is focusing so much on services like Xbox Game Pass to generate its revenue.
As a by-product of the ongoing trial between Apple and Epic Games, we’ve learned a lot about internal stats and upcoming projects. This includes the fact that Psyonix is working on two new Rocket League mobile games and that PlayStation accounts for almost half of Fortnite’s revenue.