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Microsoft Xbox One finally outsells Sony PlayStation 4 in U.S., U.K.

While Sony Corp.’s PlayStation 4 video game console was outselling Microsoft Corp.’s Xbox One for the bigger part of the year, in November the latest gaming system from software giant managed to finally leave its arch-rival behind in terms of sales in both the U.S. and the U.K. But will it become a new trend?

“November set a new record for sales of Xbox One, and Xbox One was the best-selling console in the U.S. and the U.K.,” said Mike Nichols, corporate vice president of Xbox marketing at Microsoft. “We are committed to making Xbox the best place to play, with this year’s best games, the best community of gamers to play with, and terrific value. We are amazed by the excitement Xbox fans have shown to start off this holiday.”

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In a bid to outsell its Sony’s PlayStation 4, Microsoft had to temporarily slash the price of its Xbox One to $349 (to $329 on Black Friday and Cyber Monday in some cases) and bundle free games (e.g., Assassin’s Creed Unity) with the console in the U.S., or just offer attractive bundles in the rest of the world. Therefore, the success of Microsoft’s Xbox One could be attributed to direct and indirect price-cuts as well as to competitive holiday lineup of games.

“Hardware bundles were a major factor in the sales of hardware this November, with a number of new bundles ranking as the highest selling hardware bundles so far this year with one bundle ranking as the highest selling hardware bundle ever based on dollar sales,” said Liam Callahan, an analyst with NPD Group.

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According to NPD Group, game console hardware sales in November totaled approximately $1.033 billion, a $294 million decline from the same period a year ago (about $1.327 billion). Sales of software declined by 2 per cent year-over-year (or by $17 million) to around $1.07 – $1.071 billion. The total available market of video games accessories was approximately $332 million, up $5 million from the same period a year ago. NPD tracks roughly 65 per cent of the U.S. retail market, including Amazon and Walmart, but using various algorithms and estimations to track other retailers, including Toys R Us and Sam’s Club.

Due to the fact that Microsoft cut the price of its Xbox One bundle (as a result of the Kinect removal) from $499 in November, 2013, to $349 in November, 2014, dollar sales of new-generation game console hardware dropped year-over-year. Despite a decline in dollar sales, hardware unit sales for the latest generation systems increased by 3 per cent over November 2013.

Keeping in mind that Microsoft and Sony sold around 2047 thousand systems (based on unofficial data citing figures from NPD, Microsoft sold about 909 thousand XB1s, whereas Sony shipped roughly 1138 thousand of PS4s in November, 2013) last November, sales of the new-generation systems this year totaled approximately 2108 – 2110 thousand units with the offering from Microsoft outselling its rival. Nintendo sold 10 per cent more Wii U systems that in the same period last year, or roughly 242 thousand. By contrast, sales of previous-gen consoles – PS3 and X360 – dropped sharply from 2013.

“Cumulative PS4 and Xbox One sales are now almost 80 percent higher than the combined total of PS3 and Xbox 360 sales after 13 months on the market,” said Mr. Callahan.

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KitGuru Says: Given the fact that Microsoft had to cut the price of Xbox One and introduce attractive bundles, it is not surprising that its system managed to outsell Sony’s PlayStation 4. But will it continue to do so? That is a tough question because both platforms have a lot of exclusive games incoming. Still, if Microsoft continues its aggressive pricing strategy, it might be able to continue outselling Sony’s PlayStation 4 since demand for new-gen consoles seems to be pretty flexible and thus depends on prices.

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