Xbox in the black: Microsoft's gaming revenue grows despite falling console sales
Microsoft has shared its financial results for the third quarter of fiscal 2025, and there is good news for Xbox fans: the company's gaming revenue has grown even as console revenue continues to decline. Overall, Microsoft generated $70.1 billion in revenue for Q3 and net income of $25.8 billion, representing a 13 per cent and 18 per cent year-on-year increase, respectively. This growth was largely driven by the success of the company's cloud and office services, but the gaming division also showed positive dynamics.
Here's What We Know
Total Xbox game revenue grew by five per cent year-on-year, while Xbox content and services revenue, including Microsoft's own games and Game Pass, grew even more significantly, by eight per cent. While the quarter saw the release of Avowed for Xbox and PC, the company mainly attributes the growth in gaming revenue to the success of Call of Duty and Minecraft.
In addition, the number of Game Pass subscribers increased, although the exact number remains unknown as the data on the number of users of the service has not been updated since February last year, when Microsoft announced that it had passed the 34 million mark.
However, these successes were partially offset by a continued decline in Xbox console sales in the third quarter, which fell by six per cent year-on-year. The decline in the Xbox console market comes amid Microsoft's ongoing efforts to introduce a platform-agnostic approach to its releases, allowing Game Pass games to be streamed on a variety of devices, from Meta Quest headsets to TVs.
Nevertheless, Microsoft has repeatedly stated that it has no intention of leaving the console market; the company has not only discussed plans for portable Xbox consoles, but also confirmed the active development of new Xboxes. Xbox president Sarah Bohn has previously stated that the new console will focus on "the biggest technical leap you've ever seen in a generation of hardware", and recent reports indicate that Microsoft is currently targeting a 2027 release.
Source: Eurogamer
