Microsoft announced its Financial report for the fourth quarter with revenue of $64 billion, up 15% from the same period last year. This is good news for investors overall, but when we look at the results of the Xbox gaming division, the result is a bittersweet victory.
Between March and June 2024, the gaming division achieved a 44% year-on-year increase in profits, with the net effect of the acquisition of Activision Blizzard King being 48 points. This means that profits would have fallen by 4% without the acquisition.
Overall, Xbox achieved Fiscal year a total gain of 61%, with the net impact of the ABK acquisition being 58 points. Much of this momentum comes from Game Pass, which reached 500 million monthly active users, according to a Q&A with Natya Sandella following the report presentation (thanks, VGCNext year we will undoubtedly see how users and markets respond to the implementation of the service’s new pricing and subscription tiers.
What concerns us about these results is the alarming decline in hardware. Xbox consoles produced 42% less than in fiscal 2023, and one possible reading of this is that Microsoft will focus its future efforts on cloud gaming and its position as a manufacturer will slowly but surely continue to decline. Comparing the current dynamics of the X Series with the same period for Xbox One sales, sales are down 13%, according to Circana’s US market data.
Despite these numbers, the company’s next hardware is expected to be unveiled later this year, be it a portable model, as rumors claim, or the unveiling of the next generation of home consoles.
What do you think about this and do you think Microsoft’s console policy with Xbox will change in the foreseeable future?
