Microsoft's phone revenue dropped by 71% in Q4 FY 2016

It's not exactly a surprise to learn that revenues from Microsoft's phone divison dropped by a massive 71% year-to-year during its fiscal year 2016 fourth quarter.

Micrsoft's numbers showed that its overall devices business went down by 33% during the quarter, offset somewhat by the 9% rise in revenue from its Surface division. Microsoft did not share any specific unit sales numbers for its Lumia smartphones from the last quarter. The company has been drastically reducing its smartphone hardware efforts, but Microsoft has said it will continue to support Windows 10 Mobile.

That includes the use of the OS in the upcoming HP Elite x3 "superphone," and there are still, of course, rumors that Microsoft is working on a high-end "Surface" branded phone that could launch in 2017.

360 Comments
  • Well, when you reduce your portfolio to effectively three phones vs eight or more, this is what happens. I've said it before: they want out of the hardware business for phones save one premium experience. This model is no different than PC (Surface) and will apply to HoloLens too. Longer term, it will be about licensing Windows 10 Mobile to OEMs. However, that has yet to make many inroads and if it does happen, it'll be a few more quarters out, if at all.
  • + don't advertise them, too. Although I think Hp will do good advertising of their phone.
  • HP won't advertise it, been said many times here.
  • I think he means HP will market their phone to Enterprise customers and through distribution partners.
  • You mean like Blackberry?
  • They're not only 'not advertising'... they seem to have a book on how to make something fail that they're operating off. They're missing out on great opportunities to inform people how many more hundreds of thousands of apps the Windows Store has, releasing phones with carrier exclusivity, doing nothing at all to aid their PR (which is coming back to bite very quickly since what people hear in the grapevine is the most powerful asset/liability)... and yeah, failing to advertise what they do have. I can't put a number to how many people I've personally talked to that think the Lumia Icon and 1520 were the last strong Windows Phones released who don't even know the 950/950xl exist. I hate to say this, but Microsoft does need to take a page from Apple's book. When numbers aren't looking good, show off cumulative sales... Apple did it, and while it was something even an amatuer analyst could see through, the majority didn't bat an eye. It brought up consumer confidence in the platform, which can effectively turn into new investment. Make your phones available on all carriers, advertise their strong points like Continuum and Windows Hello, advertise all the goodies Anniversary is bringing... and for the love of God, they have got to start advertising Windows Store statistics to show people we've come a long way since back in 2012 when we only had 120,000 apps.
  • Preach brotha. Posted via the Windows Central App for Android
  • If the Surface phone is nothing but a rumor, then at this point someone at MS should be saying that the expectation is so high that they'd better start working on one.... IOW, if MS wasn't planning one, then by way of fans, haters, and the media, they should feel that one is justified now... I just hope that's not the case, they have been working on one, and that they are in the final stages of testing.
  • Agree completely. Love the spec on the hp. That, plus the Nokia camera tech, you have a flagship.
  • Just think... Think of how good the X3 looks on paper.. And, MS is all over that phone..... Now, a purported Surface phone to be released 9, to 12 months later???... And, MS had admitted to making anything labeled Surface king of the hill in quality, design, and performance?.... If there is a SP then it will most likely make the X3 look like how the X3 makes the 950XL look... There should be a big bump in specifications.
  • Agreed. I am sure they have something in the works but yeah there is obvious demand in at least the business sector. Also, speaking of haters... I bet there will be plenty of articles about this at sites that won't cover Microsoft's innovative achievements but if it's something negative, they give it full coverage.
  • You have to admit that over the past few years, the haters have been right on Windows Phone more times than the fans and cheerleaders have been.
  • Well, I have to admit that I still don't give a damn. And I have to admit that even though Android is actually stable now, it's still just not my style. I just can't push myself to like this os. I'm glad Microsoft has haters. Although they're not really haters, just undercover fans. Posted via the Windows Central App for Android
  • Agreed. I just don't like android. I hate how it operates. I wish that I could buy any hardware I want and flash Windows to it like I can flash Linux to basically any PC I want. I'd love an ASUS Zenfone running W10M. Freedom and choice. Imagine if the tech enthusiasts that love their android had a chance to test W10M on their current device with the option to switch back if they don't like it. I'd bet a at least a few defectors to MS camp.
  • Yea. Here in Jamaica is mostly android phones. And the rich people carry IPhones and galaxy S7s. So it's something I see everyday, which is another reason why I learned to appreciate windows phone better. I recently lost my Lumia 928, so I'm using a galaxy S4 for now. The rear camera doesn't work, the Sim slot is damaged so I can't make calls. It's just depressing. And then all these new builds are releasing and I can only read about them. Lol Posted via the Windows Central App for Android
  • What's stopping you flashing the latest version of Android Marshmallow? There are plenty of custom ROMs to chose from. http://forum.xda-developers.com/galaxy-s4/i9505-orig-develop/rom-cyanoge... Take a few minutes, much quicker than a Windows Mobile update to download & install. For Google Play Store access you'll need to install GAPPS (opengapps.org), but if you want a google-free experience try f-droid.org instead. Just install the MS apps you want. But as others have said, if Windows Mobile could be flashed to other phones, then I would do so. But I'm not going to spend money on MS hardware.
  • Still looks old school to me. Like reminds me of WinMo 6.5
  • Exactly ❗
  • Android still has It's fair share of instabilities. IOS as well. I work with both on a daily basis. IMO Windows 10 Mobile is still by far the best Mobile OS at the moment. However the lack of popular apps certainly doesn't help the situation of which Microsoft with It's massive programming team could actually do something about.
  • it is not just about the lack of apps ,I've been using WM since 2012 and I made the change and got 950XL to use WM 10 as it supposed be rather than upgrading my old phone, four months of using this device it keep restarting randomly, have to charge it three times a day, completly unstable system and all the updates from MS are to fix some bugs (after the last update the glance screen is not working at all) and the question here why MS annunce an unfinished system and let all the users suffer because of it especially on MS own devices (I thing other manufacturers will have a more problems) so I think it is about time to abandon this sinking ship and move out to another OS despite my love o WM. Note: my brother own the same phone with the same problems (except of the glance screen thing)
  • Uh, W10M is full of instabilities and issues as well.
  • W10m is the most unstable mobile OS available right now.
  • Android stable? My wife's S5 keeps draining her battery within 20 minutes.. The store is the only app that is using battery and when you try and disable it, the dumb thing crashes. Sometimes I hate my windows phone but never have I said to myself I would go to android, it's either iphone or windows phone for stability.
  • Lol well it seems to vary with smartphones, as I've noticed. My friend has a galaxy S5 and it has significantly better battery life than his galaxy S4. So I don't really know what it is. It's the same thing with Windows 10 mobile. My lumia 520 ran the TH2 builds like a charm. So did my lumia 928. But other folks with the same devices had the exact opposite experience. Posted via the Windows Central App for Android
  • That's because a lot of people (some actually are pathetic haters) aren't haters, rather realist.. And, they tell it like it is.
  • I mean it's ok what they think. But sometimes it seems as if they want to persuade other people into leaving the platform. I don't like that stuff man. Let people decide. And instead of cursing here, I wish people would put their feelings aside and discuss the topics like mature individuals. And stop messing up Nadella's name. It's just childish and boring. Posted via the Windows Central App for Android
  • But, alas, its those shouty types that get heard. It's those negative tech *cough* experts that get heard. I have an iPad mini 3. I really like it. iOS on a tab just works, but, I dislike it on a phone. Android,for which I cooked roms, never felt complete or worked as a whole. It always felt as a vehicle for Google to attain as much info about you as possible, and to push their ideology. It also permitted OEM's to destroy, what could be a good OS, with so much bloat it is laughable. As a business owner, W10 just works for me. For some it won't. I run a taxi firm and use 14 mobile devices for drivers. They, despite being iOS or droid users, like it. Apparently its very easy to use, and appears smoother than their personal choices. It's horses for courses. If we all liked the same things, how dull would life be for us. As Dan said, this news was to be expected. MS have withdrawn from the device market. Many older devices dropped, only 4 devices in the line up, of which, very few were ever made. Since the reduction in devices, the OS has come along nicely. The RS previews are damned good, TH has also seen many updates, so there are some positives, despite what the naysayers and doom mongers say. Maybe they, and the 'tech' media should read the MS press releases stating what would happen over the next couple of tears, it's all there
  • Yea, the world would be like the Equilibrium movie if everyone used the same devices, so I like that there are at least three options right now. (if you're interested in the movie, it's a film starred by Christian Bale. It's an awesome movie, give it a watch if you haven't already.) Posted via the Windows Central App for Android
  • and don't even sell the phones worldwide. Brasil, a big Windows Phone market, was abandoned after the Lumia 640XL, not even the 550 or 650 released.
  • You aren't missing out on much Posted via the Windows Central App for Android
  • That's a dumb statement. He is missing tons. He is right Brazil used to have a larger WP8 share than iOS don't know if that has continued. But lack of 950/XL hurts as a consumer if you want the next great thing. Just like all Galaxy gas want the new one and any iPhone release swarms Apple fans, Windows Fans are the same I wanted a 950XL on vze and it nevered happened. Was waiting for announce to see if HP would make a VZW x3 didn't happen. I'm done with VZW defecting to T-Mo after my next bonus check to buy my wife a Zenfone Zoom (installing Windows 10 on the Atom processor for her to use as her windows tablet and phone) and me an Elite X3
  • I'm sure there was a reason, but, with my limited information, I think it was an error. Seemed popular in South America, as it is in Europe.
  • Microsoft is not interested in consumer devices. They are aiming for enterprise.
  • Which is funny, because way back in the old day when Windows won the Desktop war they went after the consumer and the business followed.  Back then it was all IBM and OS2 for the enterprise.  Just because I'm forced to use a divice at work does not mean I'll want to use it at home.  Which is why that damn work iphone sits unless I'm forced to carry it around.
  • Good point. You're right, it doesn't mean you'll use it at home. However, it will get Windows 10 Mobile phones more exposure and some may actually like it enough to want to use as a daily driver. I don't know if that's MS's desire, but it certainly couldn't hurt.
  • Yeah, I don't get it. I live in Rio, Brazil. I have a Lumia 830. My wife has a Lumia 640XL and his Mother has another one. My brother has a Lumia 820 (expecting for something midspec), my mother has a 640. My team in my Company all have a Windows Phone (730, 735, 635 and HTC 8x. I made them migrate to Windows Phone Platform. I did pretty good job, maybe better than MS. But MS only sees its ecosystem - beware MS, despite most computers around the word have a W10 on it, Apple and Google are going to take over the entire market of average users. Most of people I know today use the computer only because of Word and Excel and some other specific softwares. It's ok, if it is what the company wants. I am really starting to get tired in this journey of platform support.
  • There is no reason to "get tired," just buy the devices that suit your needs, and quit worrying about the other stuff.
  • «despite most computers around the word have a W10 on it…» Most computers in the world do NOT have W10 installed. http://www.makeuseof.com/tag/microsoft-pushed-windows-10-results/ But I feel you're right about people using computers (I guess you mean desktops / laptops) for specific reasons, rather than as a general tool, and that's based on my personal observations not on any hard data.
  • Glad to see that the first commit on this article about expected results isn't the doom bringers raging about how win mob is dead.
  • It is dead mate, no need to put up the shields, it's more dead than Elvis.
    Only possibility moving forward is a Lazarus act via enterprise for a tiny market share..... Which will keep it on life support for me.
  • Well if its dead then im a necromancer as this ***** in my hand seems alive to me.
  • Lol... I think he's not being negative, rather just saying that it's relatively dead... Compared to the competition. But, it's hanging in there for dear life.
  • The reality, for all intents and purposes it is dead. Does that stop me using my numerous HD DVD players, Zune and Lumia 930?
    Hell no, luv my WP phones and will buy them new very cheaply for years to come....... But peeps,as a platform it is dead.
    Accept it, keep enjoying your products, and fingers crossed we might experience a Lazarus via Corporate
  • Dude, is deader than blackberry!
  • Windows mobile is not making money for Satya, so it is a low priority for them. Their focus is elsewhere.
  • Dead to the average consumer, maybe. But, I will continue to use Windows 10 Mobile, as long as I can get my hands on one that I like. I personally don't particularly care for android or iOS, but I'm no hater of them, either.
  • Elvis keeps making appearances......
  • Lol, so true
  • They were right though! Posted via the Windows Central App for Skynet
  • 3 mediocre phones without a hint of what made people "fans" of wp before
  • how is a 950 a mediocre phone?
  • L950 is a great phone. However W10M launched with too many bugs and too few features. The execution was also terrible since 920 owners had to wait three years.
  • Well it's no longer mega buggy and featureless so its time to spread the word august 2nd
  • Yeah must admit the latest insider builds are working quite well on my 950. I was almost at the point of sending my second had set back to then and asking for a refund. The daily random restarts were out of control, however this seems to be resolved and the features keep on coming.
  • A lot of the bugs and crashes are gone, but browsing the web with Edge is painfully slow and mediocre.
  • +9 50 ..XL
  • Was with you until you mentioned 920 owners had to wait 3 year ...the 930 was more widely available for 920 owners to upgrade to. I own all three (920,930 and 950), overall, I still love my 930 the most and it performs just as good and better in some areas than my 950 despite the latter having a better processor (though I presume once the OS gets ironed out, I will finally enjoy the 950s processor more). It has everything the 920 offered and more (except for glance), so to say 920 owners had to wait 3 years, is their own fault, not Microsoft/Nokia.
  • 920 owners in the US couldn't get the 930/ICON as the phones were on 2 separate carriers.
  • you mean Lumia 930 and 1520 users?
  • Time to stop defending WP, she's gone.
    Doesn't mean you and I still can't enjoy a great product but it's time to call it.
    Far out, I remember HD DVD being officially shot and it was 100 times stronger than WP ever was.
  • That's because blu-ray is clearly the better technology. HD DVD had a much lower quality limit. Windows 10 Mobile has no technological limits and can continue to get better.
  • People said that with every OS they produced and here we are.
  • Lol I guess you're right. As long it's still operational I'll use it. I only use Whatsapp, Facebook, instagram, the music app and the camera, so I'm good with the apps available for Windows 10 mobile. Right now I'm using an Android phone, and let me tell you...... I'm miserable,I'm bored and I'm eager to get a job so I can buy a lumia 1520 Posted via the Windows Central App for Android
  • The PS3 was a BluRay player and game system all-in-one that cost the same or less than most HD disc players at the time. That fact alone put many nails in the HD DVD coffin.
  • Well they said Bing is dead, Xbox is dead, Surface is dead, Windows is dead for many times too. It is just the current trend to call Windows Mobile is dead.
  • Maybe you should adopt the mantra of Arnie.....Win Mobile, I'll be back...... Even a blu ray player, upscaling a dvd does a better job than HD DVD.
  • Cheap build quality, uninspired design, horrendously buggy software (at release). Use of an Iris scanner when finger print sensors are much faster/convenient. The iris scanner is alright, but having to hold the phone up to your face does not compare to tapping your home button. The phone itself is decent from a functionality and power standpoint. But it looks and feels pathetic when compared to the iPhone and the new samsung devices. Even my 500 dollar oneplus 3 beats the hell out of the 950 in design/build quality.
  • Maybe out of the box the iPhone has a better look to it, but consider that most owners take it out of it's package and stick it right into a big bulky case to protect its fragile construction the style of the device shouldn't be such a big deal.
  • The fact that most people use a case does not excuse a device for having cheap build quality compared to its competition.
  • If my son even looked at his iPhone and frowned the screen would crack. If you went shopping with it, it would jump out of his pocket and bed down with the bananas' ;-)
  • how are we (people in colder climates) supposed to use a fingerprint sensor with our gloves/mitts on? Clearly in some countries such as Canada, the use of Iris Scanner is a win-win!
  • the lumia 950 doesnt have super sensitive touch so you cant do anything with gloves on anyways.
  • Do you own one?.. Any of the 950s?
  • yes
  • Surely you do..
    My question was for- brent0007
  • I can see your point about finger print scanners, but why follow like sheep? I see, maybe wrongly, the 950 series as a developmental device. We had Iris and continuum, two different concepts on a mobile device. Something completely different to stupid curved screens and the like.
  • Android has had face scanning for years. It sucks. Having to hold your phone up to your face in order to unlock it never made sense when a pin pattern was faster and more convenient. I know retina isn't quite the same, but it basically is. Microsoft dropped the ball not having fingerprint support earlier. Posted via the Windows Central App for Android
  • Internally, Microsoft is not particularly proud of these phones or the state of the OS. They want to address that with RS2 and RS3 along with the phone from Surface team, assuming it goes through.
  • Every now and then I see a comment from Dan that I love, like this. Gives me hope.
  • Brown nose
  • You, my friend, need a woman... 'private time' obviously isn't satisfying you anymore
  • Guess what? You'll see all your dead pets at the Rainbow Bridge someday, too.
  • Daniel needs to come into the comments to show support on both good and bad. Right now there's way too many bad people here in the comments sections of each article.
  • I actually really love my 950. I feel like they finally got it "right". GREAT camera, perfect screen size, perfect screen quality, removable battery, SD Card, thin and light. I agree that the iris scanner is crap... I wish they could use the camera from SP4 which works amazing. But other than that, I'm far happier with this phone than any other Lumia (and I have most of them).
  • Hey Daniel, do you think they can get back to that same stability that they had with wp8? Posted via the Windows Central App for Android
  • considering how often they change their minds, wont be long till they decide minimalism and form over function is good again
  • Sigh could you just answer the question intelligently please? If you can't give me a good answer just don't pay my comment any mind then. Posted via the Windows Central App for Android
  • Clearly defining the feature set, interface, and interaction between the two. Clearly defining the hardware required to run the OS. Hiring programmers who know who to programme efficiently. Rigourous beta testing across all devices the OS is designed to run on. Rulthless elimination of all discovered bugs re-writing code rather than introducing work-arounds. Repeating 4 and 5 Releasing a build only once it has passed through quality control, not rushing it to release and relying on patches to fix broken, buggy, poorly programmed functions and features.
  • The latest RS build is very stable for me. Compared to TH, 10586.xx, its night and day. It transforms the 950 series. My xl absolutely flies along now. It's a different beast altogether. The OS is developing better than I could have hoped. For those left in the Mobile department, they have done an amazing job. They deserve a great deal of credit in these troubling times. How's that for positive? And, I stand by what I said
  • Agreed. Considering of what Panay has said last year about Lumia phones aren't their 'handmade' phones, they do have less support on those phones, until the next Surface phones arise.
  • Microsoft profit actually goes up by 1% yearly. so, I hope there is no panic situation regarding mobile. They will give it a try.
  • Lumia 950 is by far my most favorite mobile, sleek looks, snappy and logic OS. Only the apps.. Yup Posted via the Windows Central App for Android
  • and yet, sadly, extremely overprice for what you get...   and yes, I've seen those promos of 2 for 1 when buying the XL and getting the 950 for free, but the XL seems too large for my taste.
  • It seems fine to me... I definitely will get the 950 xl