Xbox is doing great heading into the launch of the Xbox Series X and S consoles in November. Microsoft announced its earnings for the July-September period, and Xbox was a bright spot.
Gaming revenue rose year-over-year by $550 million, or 22 percent, due in part to increased spending on games and services. The content and services department of Xbox specifically saw its revenue rise by 30 percent, which works out to a whopping $649 million increase.
This growth was driven in part by third-party games, Microsoft said, though it did not mention any by name. As a platform-holder, Microsoft gets a 30% cut of every game sold on Xbox, and with games overall flourishing right now during COVID-19, Microsoft is making big profits. The growth was also fueled by an increase in Xbox Game Pass subscriptions, along with first-party game sales.
It wasn’t all sunshine and rainbows, however, as Xbox hardware sales dropped by 27 percent due to fewer systems being sold. That makes sense given that the Xbox One is many years into its lifecycle and the Xbox Series X and S consoles are right around the corner, so people may be holding off on purchasing a new Xbox right now.
Xbox is just one division of Microsoft, of course. Overall, Microsoft is crushing it right now, with the company posting revenue of $37.2 billion (+12 percent) for the period and a profit of $13.9 billion (+30 percent).
Microsoft recently dug into its bank account to pay $7.5 billion to acquire ZeniMax and its subsidiary Bethesda. The deal hasn’t officially gone through yet, which is why Phil Spencer is limited in what he can say about the acquisition.
The Xbox Series X and S consoles will launch on November 10, priced at $500 and $300 respectively.
For its part, Sony will also report its latest quarterly earnings this week, so it won’t be long until we find out more about how PlayStation is faring in the lead-up to the PS5 launch in November.