Xbox has been struggling recently when it comes to finances, as its consoles aren’t selling as well as the company had hoped. As a result, they have started pushing their software and subscription services more. Despite that, they made several changes to the subscription costs of Xbox Game Pass, which led to a lot of outrage from people in the gaming community as the prices increased. The price wasn’t just adjusted in one country, but the price for Game Pass Ultimate, Core, and PC Game Pass were all increased, with the cost of Game Pass Ultimate increasing from $16 to $19.99 for a monthly subscription. Despite their price increases, their finances still weren’t looking great. It’s been confirmed in the Microsoft FY25 Q1 (July-September) report that Activision has been heavily pulling the weight for them.
Since the acquisition of Activision, Xbox’s gaming revenue has grown by 43%, with all of the gaming revenue coming specifically from Activision. Additionally, Xbox content and services revenue grew by 61%, with 53 points of net impact being from the Activision acquisition. While it wasn’t specified in the report, it’s assumed that the growth comes from Game Pass. This would be expected, as some of Activision’s games are making an appearance on the subscription service for the first time. This is the first time that people who use the subscription service will be able to play a Call of Duty game via Game Pass, as Call of Duty: Black Ops 6 was added to the service as a day-one release. Additionally, users will have access to Call of Duty: Modern Warfare 3 and Warzone.
Also mentioned in the report is that Xbox hardware revenue has declined 29% year-on-year, which was expected. Microsoft hasn’t worked on releasing any new console compared to their competitors, who have openly expressed that they are working on new consoles, with Sony even releasing the PlayStation 5 Pro. Whether Xbox plans on making another console seems to be up in the air at the moment, but it has been hinted at in the past that the next console to come will be “making a huge technological leap,” as reported by Sarah Bond. It’s also been teased that they are looking into making a handheld console, but again, nothing has been confirmed by the company.
Overall, Xbox’s finances seem to be balancing back out a little bit, but it’s obvious that without Activision they would be in deep water, as Activision is carrying their finances significantly with major releases such as Call of Duty: Black Ops 6.
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