Xbox console sales decline by 13%, but content revenue has increased

Microsoft has revealed that sales of all Xbox consoles fell by 13% compared to the previous quarter, but overall gaming revenue increased slightly due to Game Pass.

The details:

• According to Microsoft's most recent earnings report for Q4 2023, despite a decline in Xbox hardware sales, the company's gaming revenue increased by 1%, with $36 million USD more than in Q3. Due to the success of Game Pass and other third-party content, content and services offset the drop in hardware sales, with a 5% increase.
• Microsoft CEO Satya Nadella confirmed in an earnings call (via Eurogamer) that the company had set a record for the number of monthly active Game Pass users in Q4, with a 22% increase in hours played across all devices. The CEO was also optimistic about Xbox's future, citing the upcoming release of Starfield and the numerous games shown at Xbox Game Showcase, as well as the pending acquisition of publisher Activision Blizzard, all of which are expected to drive even more players to the subscription service.
• Xbox has had a difficult year thus far, reporting that its gaming and hardware revenue fell by 4% and 30% in Q3 in April, respectively, while content revenue increased by 3%. This was followed by some disappointing first-party titles, such as Arkane Austin's Redfall, which was not only underwhelming in terms of gameplay but also riddled with bugs, prompting Xbox head Phil Spencer to apologize to fans for the state in which the game was released.

More Microsoft news:

• Microsoft has announced a new Xbox reporting system that allows players to manually upload 60 seconds of inappropriate in-game voice chat to Xbox's support team. The company chose to focus on in-game chat because it is frequently the most used form of communication outside of the platform's party system.
• Sony and Microsoft have agreed to keep Call of Duty on PlayStation for at least the next ten years, following Microsoft's victory over the Federal Trade Commission, which allows it to complete its $69 billion acquisition of Activision Blizzard. The rest of the publisher's IPs, however, are not covered by the agreement, leaving the door open for future exclusive entries in iconic franchises like Spyro and Crash.