Microsoft announced their financial report for Q2 fiscal 2023 with the company posting revenue of $52.7 billion with a profit of $16.4 billion. What is troubling for Microsoft is that revenue from installing the Windows operating system shrank 39% compared to the same quarter last year. This is directly related to PC production plunging almost 17% through 2022 according to data from IDC.
Demand for new PCs is now back down to pre-pandemic levels as workers return to the office. So it's no surprise that Microsoft's revenue through the sale of hardware such as Surface computers also shrank by 39% last quarter compared to the same quarter last year.
Their Xbox business was affected but not as badly as the PC business with revenue only shrinking by 13%. Xbox Series X and Series S console sales were lower last quarter compared to the same quarter last year even though the device's price has been reduced to compete with the PlayStation 5.
With reduced revenue post-pandemic, it is no surprise that Microsoft will lay off more than 10,000 employees by the end of Q3 fiscal 2023. Among those affected are video game development studios, virtual reality platforms and even HoloLens which has no plans for the future except to supply IVAS headsets to parties army