Microsoft’s gaming revenue fell 21% year over year for the 2nd quarter of the fiscal year 2020, according to recently released earnings
MERSIN, TURKEY - DECEMBER 11: Controller Gamepad of Xbox Gaming Console is seen in Mersin, Turkey onMicrosoft’s quarterly gaming revenue fell 21% year over year for its second quarter of fiscal year 2020,That’s a significant number, but Microsoft says that it’s not actually all that bad, particularly here at the end of a console cycle and in the midst of the runup to the Xbox Series X.
Microsoft’s gaming revenue fell in terms of both hardware and content/services, though hardware fell much more sharply at 43%. Content and services declined by 11%, and Microsoft blames a tough comparison to inflated numbers last year.“Gaming revenue decreased $905 million or 21%. Xbox hardware revenue decreased 43%, primarily due to a decrease in volume and price of consoles sold.
All in all, decline in gaming business at the end of a console cycle isn’t anything suprising, even if the decline in content and services is a little more eyebrow-raising due to the unexpectedphenomenon. Microsoft noted that those declines were partially offset by a growth in subscriptions and services, which is good news for the company’s plans going forward: services like Game Pass are crucial to Microsoft’s plans for Xbox in the future.
I expect hardware sales to continue to decline precipitously as people save their money for the next-gen consoles before the inevitable bump with new hardware. Content and services might also continue to suffer from thecomparison, though that is likely to normalize as we stop comparing to peak months for Epic’s battle royale title.
I'm a freelance writer whose work has appeared in The Atlantic, The New York Times, The New Republic, IGN.com, Wired and more. I cover social games, video games, technol...
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