Microsoft reports revenues surge due to Xbox Series X/S


Microsoft’s gaming business is surging right now, all talks to the Xbox Series X/S. The boost in revenue comes from the stable demand for the new-gen console.

The Xbox Series X/S has been in demand since its release in November 2020. On Tuesday, the company announced its second financial quarter revenue that ended on December 31, 2020.

During that time, Microsoft boosted its quarterly gaming revenue by 51% year-over-year. Its hardware revenue also got a staggering 86% YOY, thanks to its new console.

Xbox business grows on all fronts

Microsoft is having quite a good year, even with the COVID-19 pandemic still going rampant.

Last September 2020, the company announced its Xbox Games Pass subscriptions reaching 15 million.

Around the same time, its Xbox Live had over 100 million active users worldwide. Together with the growth in both hardware and general revenue, its content and services grew too.

Thanks to its first-party offerings and third party titles, Xbox grew 40% YOY in its content and services revenue. The growth on all fronts is evidence that their model works.

Their “Xbox everywhere” model, together with the consumer-friendly Games Pass, is a hit among customers. They are building more goodwill as time goes by.

“The launch of Xbox Series X and Series S was the most successful in our history with the most devices ever sold in a launch month,” said Microsoft CEO Satya Nadella in an earnings call.

The game revenue itself came to as much as $5 billion.

Microsoft looking to build on a current streak

The Xbox Series X/S is genre-defining. However, PS5 is leading the way due to insufficient optimization efforts from Microsoft’s side.

Several reports of similar games running on the weaker PS5 that runs worse on the Series X.

According to speculation, the Series X only provided its dev kit to game studios only a few months before launch.

Sony, on the other hand, gave their dev kit long before, resulting in better optimization. Even then, the Series X/S are not far behind.

So far, Nadella announced that the Game Pass now has 18 million subscribers. The three million growth from September is positive, especially for the consistent earnings.

Last week, Xbox also walked back on the decision to increase their Xbox Live Gold membership price.

The company initially planned a price hike for all memberships, almost doubling its current pricing.

Xbox pulled back to keep the goodwill they built over the past few months. Even then, the software services for Xbox Series X/S will likely receive a more realistic price hike soon.

Featured image courtesy of Xbox/Youtube Screenshot

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