Microsoft have released their financials for the fourth quarter and full fiscal 2016. Gaming revenue dropped by a whopping $152 million (9%), mainly as a result of lower revenue with hardware sales. As Microsoft have bundled together Xbox 360 and Xbox One sales, it is likely that the former stands for most of that drop, but lower prices also paint part of the picture. Whether there was a drop in unit sales of Xbox One is something one can only speculate on, but given the 33% drop in hardware revenue it would seem likely. Clearly, the incoming boost thanks to the launch of Xbox One S will be most welcome. Part of the lower hardware revenue was offset by record numbers on Xbox Live, currently there are 49 million monthly active users (up 3 million since last quarter).
Overall, Microsoft are still making tons of money, profits rose (operating income was $20.2 billion GAAP for fiscal 2016), while revenue was down ($7 billion), and the Xbox business is a very small part of the overall business as per usual.