Microsoft Corp. is asking its Xbox gaming division to produce profit margins that are well above the industry average, ratcheting up pressure on its video-game makers during a difficult time for the field at large.
Over the past two years, executives at the Seattle-based software giant have set an across-the-board goal of 30% “accountability margins,” a term Microsoft uses in lieu of profit margins, according to people familiar with the business. The gaming division, which includes dozens of studios, has responded by canceling products, raising prices and slashing thousands of jobs, said the people, who asked not to be identified discussing nonpublic information.
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