Microsoft reported its fourth-quarter earnings, announcing that while gaming revenue has fallen by $259 million (roughly 7 percent year over year), this is in line with predictions around Xbox hardware.
Revenue has fallen but that doesn’t mean that Game Pass has. Instead, Xbox has seen growth in Q2 2022, helping offset the revenue losses for Microsoft. Xbox also saw a decrease of 11 percent decrease in year-over-year revenue that was bolstered by Game Pass subscribers.
“The decline you’re seeing in Xbox hardware is partly a reflection of the fact we had that launch… about two years ago, so with the supply constraints that we had seen over the last couple of years it has kind of extended out that period for consoles,” says Kendra Goodenough to The Verge.
Microsoft CEO Satya Nadella tells The Verge that Microsoft has “been the market leader in North America for three quarters in a row among next-gen consoles.” Xbox has seen its best fiscal year relating to revenue with $16.2 billion for the entire fiscal year. We can confirm Microsoft predicts another downward turn for next quarter as gaming revenue and Xbox content and services will decline.
Xbox also revealed that more than 10 million people have used Xbox Cloud Gaming to play video games, this is due to Fortnite being free to play on the service. “Over 4 million people have streamed [Fortnite] to date, including over 1 million who were new to our ecosystem,” says Nadella