Trending
It's been another rough quarter for Xbox. Microsoft's latest financial results reveal that hardware revenue plummeted 32% year-over-year during the crucial holiday period, whilst overall gaming revenue fell 9%, The Verge reports. That's three years running of declining hardware sales, and the numbers don't look like they're turning around anytime soon.
Game Pass Growth Stalls
Perhaps more concerning is the 5% drop in Xbox content and services revenue, which includes Game Pass subscriptions. Microsoft's explanation? Stronger first-party performance in the previous year, not the Game Pass Ultimate price hike that landed during the quarter. Whether you believe that is another matter entirely.
The company has gone suspiciously quiet on Game Pass subscriber numbers. The last official figure was 34 million nearly two years ago, and that included Xbox Game Pass Essential (formerly Xbox Live Gold) members. Draw your own conclusions.
What makes this decline particularly notable is that it arrived despite a solid lineup of releases. Gears of War Reloaded, The Outer Worlds 2, Call of Duty: Black Ops 7, Ninja Gaiden 4, and Keeper all launched during or near this period, yet none managed to significantly boost revenue or Game Pass subscriptions. That's not the result Microsoft would've been hoping for from such high-profile titles.
Multiplatform Strategy Accelerates
Microsoft continues doubling down on its multiplatform approach, with previously Xbox-exclusive games heading to PlayStation 5 and Nintendo platforms. Halo: Campaign Evolved arrives on PS5 and Xbox in 2026, whilst both Fable and Forza Horizon 6 are confirmed for Sony's console this year.
It's a sensible strategy given the hardware struggles, but it does raise questions about what actually defines an Xbox exclusive, if such a term even exists anymore.
DON'T MISS:
- PlayStation State of Play could return in February after Xbox Developer Direct sets the bar
- Fable details, platforms and release window revealed at Xbox Developer Direct 2026
- Forza Horizon 6 editions and release details revealed at Xbox Developer Direct 2026
- Xbox Free Play Days (January 22-25): Sherlock Holmes, South Park, Cult of the Lamb and more
- Life is Strange: Reunion revealed for PS5, Xbox Series X/S and PC, launches March 26
