Microsoft Reaches Trillion-Dollar Valuation

Good times.

31 Comments
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Now Playing: Xbox One Sales Are Down, But Microsoft Is Doing Great - GS News Update

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Technology giant Microsoft is rising to new heights. After reporting strong earnings results last week, the company reached a valuation above $1 trillion for a period of time.

This happened by way of Microsoft's share price jumping as a result of the positive earnings report, which in turn pushed the company's total market valuation to above $1 trillion for the first time ever. Share prices later dropped, decreasing the overall valuation to around $995 billion. Apple and Amazon are the only other companies to ever reach a $1 trillion market valuation based on share prices. They have also retreated. Microsoft's $995.4 billion market valuation currently is ahead of Apple ($973.2 billion) and Amazon ($942.8 billion). Stock prices are constantly changing based on a variety of factors.

What propelled Microsoft's share price to climb was likely the strong third-quarter earnings results it announced last week. Microsoft's revenue jumped 14 percent to $30.6 billion, while net income rose a healthy 19 percent to $8.8 billion. Yes, that's $8.8 billion in profit for three months.

As GameSpot sister site ZDnet reminds us, Alphabet (which owns Google) is now the only remaining member of "The Big Four" to reach a $1 trillion market cap.

Microsoft's earnings report also provided some insight into the health of the Xbox division. While Xbox One console sales are down (just like PS4 sales are), total gaming revenue at Microsoft jumped by 5 percent. This uptick in revenue was driven by Xbox game sales and services, which rose by 12 percent.

Microsoft just announced a new disc-free Xbox One, but that's not the only console the company has in the works. At least one next-generation console might be announced at E3 2019 in June, so keep checking back for more.

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Avatar image for lordroberts774
lordroberts774

As the tech bubble burst of 2001 showed these valuations are meaningless when the bubble pops. Right now it's expanding due to confidence, but it's going to recede at some point in the future.

Avatar image for Shantmaster_K
Shantmaster_K

Hopefully they continue to invest in the Xbox divison.

Avatar image for lordroberts774
lordroberts774

@Shantmaster_K: when haven't they?

Avatar image for Shantmaster_K
Shantmaster_K

@lordroberts774: not the point I was getting it. I just meant acquiring studios and bringing exclusives.

Avatar image for Vodoo
Vodoo

I can't even imagine being an accountant for a company this large. Keeping track of all the sales from different divisions, the huge amount of write-offs from individual personnel (which numbers in the thousands of people) ect... They probably have a whole division of just in-house accountants.

Avatar image for attirex
attirex

bargain bin purchase. pass.

Avatar image for Xristophoros
Xristophoros

no thanks to their xbox division which has been losing them money for a decade.

Avatar image for Shantmaster_K
Shantmaster_K

@Xristophoros: They're doing quite well in the Xbox division actually.

Avatar image for pharoe777
pharoe777

@Xristophoros: Settle down fanboy

Avatar image for jagdedge124
jagdedge124

Well, there it is. Don't see Sony up there . That's why i have to laugh about these "console war" conversations. You think Microsoft gives a wit about Sony...in any way? Microsofts game division is a tax write off, to the extent they even pay taxes lol. Microsoft will always win because they''re just too big to fail.

Avatar image for Xristophoros
Xristophoros

@jagdedge124: just because microsoft has more money than sony does not change the fact xbox has been a major disappointment for most people. xbox lost this console gen by a huge margin. next gen, expect xbox to go all in on games as a service and streaming.... yea, the future does not look bright for xbox and most people wouldn't even care if they dropped out of the console hardware business altogether. there are only a handful of IP people play from the xbox brand -- micrsooft could continue to release those titles as a software publisher instead...

since sony is more dependent on its playstation division to keep the company healthy on the whole, you can expect better games and better products from them. well, that goes without saying...

Avatar image for ivanov70
Ivanov70

@Xristophoros: That makes no sense at all they are developing 2 new consoles and just because they are launching a streaming service similar to PS now they're suddenly exiting the console market?.

Avatar image for Xristophoros
Xristophoros

@ivanov70: i'm saying it wouldn't make a difference if they exited the console space since they are going all in on streaming and already have all their games on pc.

Avatar image for lonesamurai00
lonesamurai00

@Xristophoros: Personally not being able to play Playstation games on the PC is one of the reasons that I avoid buying the games at all. Having the choice of how you want to play these games is always a good thing and people will buy the Xbox Windows versions, Xbox console versions, or Xbox streaming versions for their own reasons. Having choices is a good thing.

Avatar image for jagdedge124
jagdedge124

@Xristophoros:

Not no more is it a disappointment. Not by a long shot. Game Pass and BC and all the rest, it's no doubt a better value for your money.

I own both systems, and i gave up PS Plus a couple years ago. And if anything, the future looks much brighter for Xbox.

What are we hearing or heard from Sony? There's a reason they're skipping E3, being they ran out of gas.

Stream gaming in the age of Google etc, they can buy EA and shut Sony from the sports market. They can buy Gabe over at Valve. They're just that big. It could be near over for Sony, and would be if Microsoft wanted it to be. But like i said, they just don't matter.

But it's due to the amount of money Microsoft has. That's why when they have so much money, they're always gonna win in the end. It's like comparing Goldman Sachs to Happy's Community Bank lol.

Avatar image for nedrith
nedrith

@jagdedge124: So remind me if MS has so much money, why can't they put out any good first-party games other than Halo and Forza.

I and many others stay with Sony because they actually care about their console and they actually care about the games. MS just treats their console as a money maker. Sony actually invests in it. Exclusives like Persona 5, Horizion: Zero Dawn, Bloodborne, Ect are just plenty of reasons to stay with a PS4 and MS still hasn't given me a reason to get an Xbox 1. If I had to make a list of my top 10 games this generation, I can guarantee you atleast 4 of them will be exclusives.

We are seeing this difference in sales numbers. Last gen the two consoles were neck and neck with the 360 leading as it continued to get decent exclusives. This generation PS4 is almost at 100 million while Xbox 1 is struggling to hit 50 million.

You don't have PS plus? Who cares, Sony almost has as many PS+ subscribers as MS has sold X1 consoles.

Avatar image for chris91090
chris91090

@nedrith: Interesting. Let me post a question here:

Given Sony's track record of focusing on single player games, what reason do I have to continue a PS Plus subscription, or invest in the console beyond the exclusives? Why should I invest multiplatform games, some that have multiplayer as a major component, in a system that historically focuses more on single player experiences?

To someone of my tastes, who plays a wide range of games, it makes more sense to invest multiplatform and a subscription on the console that provides the widely agreed "better online" experience, Xbox. I can play Halo, Division 2, Mortal Kombat, Overwatch, and Assassin's Creed all on one machine, using one subscription. The Playstation? I have Nier, the Tales of games, Horizon, and God of War, all offline.

Could the Xbox use more games? Sure, anyone can. But to think Sony isn't after money in their business as well is a bit naive.

Avatar image for jagdedge124
jagdedge124

@nedrith:

Well, the simple answer to your first question, is that they don't need too, for obvious reasons. They make money in other ways, and in those ways, they may not even need a machine before long.

I mean i'm glad you like your games, but i didn't buy PS for the exclusives (i'm not into fantasy or sci fi, i'm into war games and sports).

I bought it b/c it was a better machine. But Xbox now has better machine, so, there goes that rationale.

Avatar image for Xristophoros
Xristophoros

@jagdedge124: despite having all that money, microsoft failed to put out many notable exclusive games on its platform this gen... sony is leading the market with the best exclusives. what does that tell us? it takes more than just money... it takes passion, vision, experience, talent, good management, etc... sony and nintendo have all of these attributes... xbox division has... maybe one? i will stick with the platforms that provide the best games and that would be sony and nintendo platforms. it isn't even debatable at this point. as for what did we hear from sony? well, just last week they confirmed some details about the ps5 and that it will be releasing next year. what else do you need to know? ps4 is doing so well for them (about to surpass 100m units sold) that it does not need to rush out ps5 just yet. that is a sign that business is good and healthy over at playstation with some of the best games this gen yet to release... last of us 2, death stranding, ghost of tsushima etc... microsoft can have the most money but it really does not mean anything when discussing the best video games this gen. they are not part of that conversation.

Avatar image for jagdedge124
jagdedge124

@Xristophoros:

Well, i just responded to the other guy about that, and they didnt need exclusives. They made a fortune in other ways. Game Services, Phones, Apps, PC etc.

The biggest sellers aren't exclusives. It's Red Dead, sports and cross platform games. And with stream gaming coming forth, and access to Steam and the like, games aren't going to be an issue in the future.

In short, Sony is just too small, and in hindsight, focusing on a few exclusive games, and not the gaming future may indeed be their waterloo.

Avatar image for UltimateBastard
UltimateBastard

They have the worst tech support I've ever experienced. Contacted them a couple of times over the years, might as well have not bothered. Most recent one was the best, asked them for the steps to delete an xbox live account attached to my Microsoft account. Under no circumstances though do I want to delete the actual Microsoft account. Stupid bitch sends me back the steps to delete my Microsoft account. Says I wasn't clear enough in what I was asking. Says I can't delete the xbox account attached to it.

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Ivanov70

@UltimateBastard: my 360 red ringed on me 3 times I got all 3 replaced entirely free even the out of warranty one.

Avatar image for UltimateBastard
UltimateBastard

@ivanov70: That's actually another one. I had multiple red ringed 360's. The first one they offered to repair it for free, but god knows how long it would have been away for. Instead I took it back to the shop I got it from and they replaced it on the spot. Did that the next couple of times.

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pharoe777

@UltimateBastard: ...and I've had nothing but great customer support service, and given free months of xbox live when i had an issue.

Avatar image for UltimateBastard
UltimateBastard

@pharoe777: Do you know who I've had amazing customer support from and its highly surprising since they're renowned bellends, EA. Anytime I contact EA they are nothing but helpful. I had two separate Origin accounts and wanted to consolidate all my games to a single one and delete the other account. Not a problem have that sorted for you in a second. Asked Steam to do them same, took them the better part of a month to even respond and tell me they can't do it.

Avatar image for pharoe777
pharoe777

@UltimateBastard: Thats true, I've actually had good results with EA customer support.

Avatar image for DarknessR18
DarknessR18

All that money and they can't give us some decent exclusives? ffs.....

Avatar image for lonewolf1044
lonewolf1044

@DarknessR18: It is more than thier console dept as the console dept is not even the core of thier business. However for every console sold it adds to the pot.

Avatar image for ender003
ender003

"As GameSpot sister site ZDnet reminds us, Alphabet (which owns Google) is now the only remaining member of "The Big Four" to reach a $1 trillion market cap."

This sentence says the opposite of what it intends.

Avatar image for lonesamurai00
lonesamurai00

hmmm, and Sony....

Avatar image for YukoAsho
YukoAsho

I'm kinda surprised they weren't already there. The games division has long been a lark for the company. They've got tons of money in the bank owing to Windows and Office, and their Azure platform is also coming into its own. Xbox could crash and burn tomorrow, and it wouldn't really matter for the company at large.