Deliveries of Microsoft smartphones plummet despite Lumia 950 series release

Microsoft delivered three quarters fewer Lumias last quarter than in the same period the year before. In addition, the company notes that it also has unsold stocks. Sales from the Surface line of products did well.

Deliveries of Lumias amounted to 2.3 million units, compared to 8.6 million Lumias in the same period last year. The turnover from smartphones is 46 percent lower, according to the quarterly figures. From this it can be deduced that the average sales price of a Lumia rose.

Microsoft’s financial director Amy Wood also notes that the ‘channel inventory’, the stock of smartphones that have been made but not yet delivered, is relatively high. As a result, the financial director expects an even sharper decline in smartphone sales in the coming months.

The decrease is striking, because Microsoft released the Lumia 950 and 950XL at the end of last year, in addition to the cheaper Lumia 550. The new line of Windows 10 mobile models have not yet had a positive effect on deliveries. Microsoft attributes the decline in sales for the entire group mainly to declining sales from smartphones.

The release of the Surface Pro 4 and Surface Book last fall did have a positive effect on the turnover of Surface products. It rose by 61 percent compared to the same period last year to 1.1 billion dollars, against one billion euros.

The company’s PC division also performed relatively well. Sales fell two percent, but according to Microsoft, it is doing better than the market as a whole, which fell more. According to the company, this is mainly due to the sale of more expensive laptops with Windows.

Gaming revenue rose 6 percent, despite the decline in hardware revenue. This is mainly due to the drop in sales of the Xbox 360, which will soon be out of production, and the decreased price for the Xbox One.

Office and Office 365 revenue grew 7 percent and Office 365 now has more than 22 million subscribers. Windows 10 has 270 million users. Things went best with Azure, Microsoft’s cloud platform. Turnover grew by 120 percent, surpassing $10 billion for the first time. In total, Microsoft amassed $20.5 billion in revenue and profits totaled $3.5 billion.