Content and Services Revenue
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Xbox revenue plunges $1.7bn, with hardware dropping 29% YoY
Microsoft's latest financial results reveal a significant 7% year-on-year decline in Xbox revenue for the full year and 10% in the fourth quarter, primarily driven by a 29% drop in hardware sales. Despite growth in Game Pass, content and services revenue also fell by 10%. The company announced widespread layoffs affecting 4,800 roles, including 1,600 at Xbox, as part of a restructuring aimed at long-term growth, with several studios transitioning to new management or becoming independent.
Xbox hardware revenue drops 33% year-on-year during Q3
Microsoft reported a 33% year-on-year drop in Xbox hardware revenue for its third quarter, alongside a 5% decrease in Xbox content and services. CEO Satya Nadella stated the company is focusing on foundational work to regain player engagement and improve quality. Recent changes to Game Pass pricing and strategy, including a renewed focus on daily active players and expanding into new markets, are part of Xbox's plan for sustainable growth.
