Microsoft suffers an 11 percent drop year-on-year across its Entertainment and Devices division.

Falling Xbox 360 sales have contributed to Microsoft’s Entertainment and Devices division seeing an 11 percent year-on-year drop of $3.77 billion in revenue during the last quarter of 2012, with much of the games industry eagerly anticipating the next Xbox.

People have been buying fewer Xbox 360s.

Announced during Microsoft’s latest earnings call, the Xbox division specifically saw a 28 percent drop in sales from the same three-month period last year, shipping 5.9 million Xbox 360 units compared to 8.2 million from the year before.

The report isn’t all doom and gloom: Microsoft says Xbox 360 is still North America’s most popular console.

The Entertainment and Devices division also launched Windows Phone 8 during the same quarter, and Microsoft has said spreading its games across multiple connected devices will be crucial to its future plans.

Earlier this week a report claimed to know the specs inside the Xbox 720. For more news on Microsoft’s plans to go next-gen, check out GameSpot’s ongoing coverage.

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