Despite closing several game studios and laying off thousands of employees in recent years, MicrosoftEarlier financial reportIt revealed that its gaming business continues to show strong growth, and its game subscription service Xbox Game Pass generated nearly $50 billion in revenue in the past fiscal year and accumulated 5 million active users.
Microsoft's financial report shows that out of the total revenue of US$764 billion, the gaming business revenue increased by 9% year-on-year, contributing US$20 billion in revenue. Even though console sales are declining, the revenue from software and services still has extremely high growth potential.
The Xbox Game Pass service currently offers a curated selection of first- and third-party game content, fostering a highly engaged gaming community and a diversified business model. Microsoft stated that in addition to the traditional subscription model, it is also actively pursuing advertising and digital store revenue to further expand the overall value of the Xbox ecosystem.
In addition, Microsoft also pointed out that the current usage model of cloud game streaming has accumulated more than 5 million hours of total gaming time this year.
Despite recent large-scale layoffs and internal restructuring, Microsoft has already laid off over 2025 employees by 9000 and closed several game studios, including The Initiative, the team developing the Perfect Dark reboot, which has also been disbanded, sparking widespread attention and controversy within the gaming community. Despite this, Microsoft CEO Satya Nadella emphasized continued investment in gaming content and studios during the company's earnings call, furthering its long-term intellectual property portfolio.
Satya Nadella also pointed out at the meeting that Microsoft is currently the largest publisher in terms of both first-party and third-party game releases on both Xbox and PlayStation platforms. This includes titles such as Forza Horizon 5 and Oblivion Remastered, which have performed well, demonstrating that the cross-platform strategy is gradually taking shape.
Meanwhile, Microsoft stated that it currently has nearly 40 new games in development, indicating a steady stream of new game releases for the next few years. However, some gamers and industry insiders are dissatisfied with Microsoft's strategy of expanding subscription services and consolidating resources while simultaneously laying off employees and closing studios, questioning its strategy of sacrificing creativity and talent in the name of efficiency.
Although the official emphasis is that "players remain the core of the Xbox ecosystem," the key question to watch will be whether the Xbox Game Pass service can maintain content diversity and stable quality in the future, given the trade-offs between content production and development resource allocation.
