Xbox’s behemoth parent company Microsoft recently released its financial results forQ4 2025, a period that ended on June 30 of this year. According to the report, Microsoft’s gaming revenue is up 10 per cent year-over-year, with Xbox content and services revenue growing by 13 per cent, though hardware revenue is down 22 per cent.
Microsoft cites the number of first-party games released, as well as an increase in Game Pass subscriptions, as the primary drivers of growth in this area.
Xbox Game Studios has released quite a few first-party games over the past financial year, including Microsoft Flight Simulator 2024, Avowed, Age of Mythology: Retold, South of Midnight and Oblivion Remastered. There have also been several games ported to PlayStation 5 in the same period, such as Forza Horizon 5 and Senua’s Saga: Hellblade 2.
Game Pass Has Taken In Over $5 Billion This Year
In an earnings call accompanying the release of the financial results, Microsoft head Satya Nadella mentioned the release of Oblivion Remastered and the porting of Forza Horizon 5 to PlayStation 5 as notable financial wins for Xbox. Forza Horizon is currently this year’s best-selling game on PlayStation 5, so it’s unsurprising that Xbox is pleased with the results of its new multi-platform strategy.
Nadella is also noted to have said that Game Pass has reached $5 billion in annual revenue for the first time ever, which is a fairly staggering number.
This success for Xbox is set against a backdrop of layoffs, cancellations and a studio closure. Microsoft (and Xbox) experienced its fourth round of layoffs in 18 months recently, despite Microsoft reporting $27.2 billion in net income for a single quarter.
Rare’s Everwild, a game in development for over a decade,was cancelled by Xbox. As wasan unannounced MMO from ZeniMax Online, which Xbox head Phil Spencer reportedly loved. The reboot of Perfect Darkwas also cancelled, and The Initiative was shuttered, without ever having released a game. At the beginning of the last financial year, Xbox closed Arkane Austin and Tango Gameworks.
Microsoft continues to lay-off workers, ostensibly to free up funding for increased investment in generative AI. Yay.
