Halo: Reach

Halo effect: Xbox success puts a glow on Microsoft's killer quarter

October 29, 2010: 1:38 PM ET

The company's blowout quarter came from nearly every division, but taking over the top spot in the video game world was its most surprising statement.

Despite a corporate restructuring, criticism that it's failing to innovate in certain sectors, the departure of Chief Software Architect Ray Ozzie and analysts downgrading its stock, Microsoft (MSFT) trumpeted a record first quarter yesterday. Overall revenue rose 25% to $16.2 billion and net income rose 51% to $5.4 billion compared to the same period last year. One the biggest movers? The Xbox 360. (The other big mover-- its stock. Nearly flat for a decade, MSFT is up about 6% so far today.)

The Xbox 360 platform, which includes hardware, games, its Xbox LIVE online community, and accessories, are all considered part of the company's Entertainment and Devices Division [EDD], which posted sales of $1.8 billion between July and September compared with $1.4 billion the same time last year. Microsoft credited that overall 27% division increase in large part to the console's growing success. More

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