“Game Bolt Achieves Record Quarterly Earnings Amidst Declining Xbox Hardware Sales”

Microsoft has once again reported a decline in Xbox hardware revenue.

In its most recent financial report, the U.S. corporation indicated that Xbox hardware revenue fell by 29 percent year-over-year during Q2, attributing this downturn to a “lower volume of consoles sold.”This follows a similar drop in Q1.

Earnings from Xbox content and services rose by 2 percent due to growth in Xbox Game Pass. Overall gaming revenue in the More Personal Computing segment reached $530 million for the quarter, representing a year-over-year decline of 7 percent.

Commenting on these results during an earnings call, Microsoft CEO Satya Nadella stated that the company is considering enhancing the profitability of its gaming sector to ensure long-term growth. These comments come after Microsoft laid off over 2,550 developers in 2024 and closed several internal studios.

He noted that Call of Duty: Modern Warfare II–the second Call of Duty installment to debut under Microsoft after its $68.7 billion acquisition of Activision Blizzard–was the best-selling title on Xbox and PlayStation during Q2. Nadella remarked that the shooter “attracted more players in its launch quarter than any previous paid release in franchise history.”

Xbox hardware in decline, yet Microsoft boasts about ‘strong momentum’ in various sectors

Reflecting on the performance of the December 2024 release Indiana Jones and the Big Circle, created by ZeniMax studio MachineGames, Nadella mentioned that the Nazi-fighting game has been played by over 4 million users. It remains unclear how many of these players purchased the title outright or opted for access via Xbox Game Pass.

Nadella stated that Microsoft continues to observe “strong momentum” within its Xbox Cloud Gaming business, with a record-breaking 140 million hours streamed this quarter. Furthermore, he disclosed that Xbox Game Pass has set a new quarterly revenue record after increasing its PC subscriber base by over 30 percent.

Discussing the future of the subscription service, Nadella affirmed Microsoft’s commitment to “growing fully-paid subscribers across platforms.”

Microsoft continues to present its primary gaming business as one that centers around “content and services” rather than hardware. Additionally, Xbox head Phil Spencer recently declined to impose barriers on first-party software, indicating we may witness an increasing number of Xbox Game Studios titles arriving on competing platforms in the future.

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