Whilst the overall picture for Microsoft is yet again one of declining revenues and income, its Entertainment & Devices Division – which houses its Xbox operations – has reported its second year of profitability, validating the huge outlays the tech firm invested into its long term games strategy.



In the quarter ending June 2009 EDD revenues fell by 25 per cent, hitting $1.19bn. However, losses were reduced, reaching $130m in the quarter, down from $171m the year before.

For the full fiscal year ending June EDD posted a net profit of $169m.



The drop in revenue was mainly down to non-games EDD devices such as the MP3 player Zune. Shipments of Xbox 360 consoles managed to buck the global recession by climbing markedly – 11.2m machines were shipped in the year, up from the 8.7m it sold in fiscal 2008.



The firm also noted that the Xbox 360 software attach rate is now 8.6 games per console, whilst Xbox Live membership now stands at 20m.



The overall Microsoft picture is more gloomy. Results for the company’s Q4 ending June 2009 saw net profits of $3.1bn, down 29 per cent from the same quarter in 2008. Revenues came in at $13.1bn – a 17 per cent decline. Operating income for the quarter stood at $3.99bn – down 30 per cent.

Revenues for the fiscal year was down three per cent year-on-year, hitting $58.44bn. Net income was $14.57bn, an annual drop of 18 per cent.

“Our business continued to be negatively impacted by weakness in the global PC and server markets,” CFO Chris Liddell stated.

“In light of that environment, it was an excellent achievement to deliver over $750 million of operational savings compared to the prior year quarter.”