With the Xbox division, Microsoft failed to build on previous years' successes in the past quarter. This is among other reasons.
Microsoft is one of the first companies to publish their annual reports for the last quarter of last year.
After a period of robust sales growth in the video game business, Microsoft's games segment had to come to terms with declines in the previous quarter. While these were expected, the absence of major games from Microsoft's first-party studios appears to have strengthened the trend.
Compared to the same period last year, Xbox content and services revenue fell by 12 percent and Xbox hardware sales fell by 13 percent.
Microsoft reports that content and services revenue "stripped compared to a strong prior year," partially owing to growing Xbox Game Pass subscriptions.
120 million people are actively involved in the sport.
Microsoft did not give a new number for Xbox Game Pass subscriptions, but did indicate that the number of monthly active gamers who are engaging with Xbox content on any device has increased.
Game Pass subscriptions, game streaming hours, and monthly active devices reached new highs in the third quarter. Monthly active users reached a new high of 120 million in the quarter.
Microsoft had a limited amount of first-party games in its portfolio this holiday season. However, note that 2021 was tough to beat. "Halo Infinite" and the Xbox Series X and Xbox Series S consoles, which were still fairly new at the time, provided plenty of sales opportunities in combination with increased availability. "Forza Horizon 5" was also released at the end of 2021.
The latest declines were consistent with Microsoft's previous projections. In October, Microsoft's chief financial officer, Amy Hood, said that Xbox's gaming revenue would decline in the low to mid-teens.
Microsoft's Xbox and gaming businesses are part of its More Personal Computing division, which saw revenue decline in several industries, including gaming. Overall, Microsoft saw revenue increase by 2.2 percent to $52.7 billion in the same year the previous year.
10,000 people have been laid off from their jobs.
Microsoft sent out a disappointing email a few days ago, revealing that it would terminate nearly 10,000 employees, including some from The Coalition, 343 Industries, and Bethesda.
Microsoft claims that these layoffs are in response to decreases in consumer spending and the current economic downturn. However, it is unclear how these cuts will affect future game development in the Xbox division, and which teams and games will be affected.
This Microsoft news might also interest you.
Microsoft is hosting a demo for Xbox and PC gamers today, including games such as "Forza Motorsport", "Minecraft Legends," and "The Elder Scrolls Online."
Microsoft has released a lot of information.
On the PlayStation Forum, you can discuss this information.
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