Xbox revenue falls again as it "recommits" to hardware and core fans under new CEO

Microsoft’s latest financial results show Xbox revenue has declined for a third consecutive quarter, as new CEO Asha Sharma says the company still has “work to do” to reposition itself.

The details:

• For the quarter ending 31 March 2026, overall gaming revenue fell 7% year-on-year, with Xbox content and services down 5% and Xbox hardware revenue dropping 33%
• The hardware slump follows last year’s Xbox Series X/S price increases in key markets, and marks the second quarter in a row that console revenue has fallen by more than 30%.
• In a post on X, Sharma said that while Xbox has “made progress expanding the business and our margins, player and revenue growth has not yet met our ambition,” adding: “We know we have work to do to earn every player today and into the future.”
• Microsoft CEO Satya Nadella has also told investors the company is doing “foundational work” to “win back fans and strengthen engagement,” saying Xbox is “recommitting to our core fans and players, and shaping the future of play,” and highlighting that the quarter still set new records for monthly active Xbox users and game streaming hours.