Xbox gaming revenues are falling, but Game Pass subscribers continue to grow

Xbox gaming revenues have largely declined on all fronts, but the number of Game Pass subscribers is still growing.

Microsoft released its second quarter financial results for fiscal year 2023 yesterday, and it revealed that Xbox gaming revenue was down 13% overall. Xbox content and services, such as first-party software and monetization in third-party games, were down 12%, but Microsoft notes that this drop is at odds with a “highly comparable last year.” Considering Xbox’s 2022 was lackluster compared to the previous year, this isn’t surprising.

However, the financial results show that this 12% drop is “partially offset by growth in Xbox Game Pass subscriptions.” Xbox hardware revenues are also down 13%. During an earnings call, Microsoft CEO Satya Nadella revealed that Xbox’s monthly active users passed 120 million in the quarter, as reported by IGN. Nadella added that Microsoft expects another year-over-year decline next quarter due to a similar situation to this quarter.

Video game sales analyst Benji Sales (on Twitter) made some comment on these financial results, stating that he is less concerned about Xbox’s gaming revenue and software performance, but that the hardware decline is alarming.

“I’m less concerned about overall gaming revenue and software performance. They’re down, but that’s to be expected given Xbox’s weak year for first-party content. The most alarming thing here is hardware. So early in a generation should we really not see any declines.”

However, as Benji-Sales and many others have pointed out, recent quarters have been lackluster for Xbox, but 2023 will be the biggest year yet for the Xbox Series X/S, with games like Redfall, Starfield, and Forza Motorsport. expected to release.

We should learn more about some of these games in today’s Xbox Developer Direct and then Starfield in a Starfield-specific showcase that Xbox is planning.


Do these financial results surprise you? Let us know in the comments below!

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