Xbox posts a 49% increase in revenue, Content and services up by 61%

In recently released Q2 figures for FY24, Microsoft disclosed that Xbox had a 49% YoY (Year over Year) increase in revenue. Microsoft’s total revenue during the period stood at $62.0 billion (18% increase), while net income was $21.9 billion (33% increase).

While financial analysts and experts predicted an increase, given the recent figures and market trends, not many would have pegged it at 49%.

Acquisition of Activision Blizzard plays a vital role

The rise in revenue comes on the heels of Microsoft’s acquisition of Activision Blizzard, which was a massive $69 billion deal. It was one of Microsoft’s biggest investments and indicated that gaming would be a critical part of its future plans.

The Xbox content and services posted a 61% increase in revenue, driven by 55 points of net impact from the acquisition. Xbox hardware figures were also up 3%, though they were expected to be slightly higher given the festive season and promotions offered by Microsoft.

This also makes gaming the third-largest contributor at Microsoft, with a total revenue of $7.11 billion during Q2. It has surpassed Windows ($5.26 billion) and is now only behind Office/cloud services ($13.47 billion) and Microsoft server products ($23.95 billion).

What’s the future like for Xbox?

Months after the acquisition, Microsoft laid off 1900 Activision employees, and it was reported that most were related to the game’s physical release and distribution.

So, it appears that Microsoft may be planning to make Xbox an all-digital console, given that 90% of the sales last year were digital copies. It may not be an immediate plan of action, but somewhere down the line, you could see it becoming a reality.

In all, Q2, FY24, has been a great period for Microsoft, with profits across most products and services. A few days ago, Microsoft hit the $3 trillion market cap for the first time, becoming only the second company to do so after Apple.

To find out more, check the official Earnings Release FY24 Q2.

Tell us what you think of the latest figures in the comments section!