All I'm suggesting is that while hardware isn’t irrelevant, it isn’t their revenue driver. The majority of Xbox gaming revenue comes from software and subscriptions, not console hardware. This is working precisely in the way that Nadella and Spencer has been yapping about to the entire world in broad daylight for some time now. They are no longer in the console war. There is no evidence (from Microsoft’s own earnings or strategic statements) that lower hardware sales have a meaningful impact on their content & services revenue, especially not in Microsoft’s broader ecosystem approach. It simply just doesn't matter when people can use Xbox Cloud Gaming from a smart TV, tablets, laptops and Cell phones.
In my opinion, there’s no point in dwelling on low hardware sales anymore. Honestly, it wouldn’t surprise me if, at some point, they decided to pull back from hardware development altogether and shift their focus to PC Game Pass and expanding Xbox Cloud Gaming beyond just Samsung TVs.