Microsoft says its revenue dropped by 7% in its Q2 2025 earnings while Xbox hardware sales dropped by 29%

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James Thompson

Games

Thu, 06 Feb

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In Microsoft’s latest financial report for the second quarter of fiscal year 2025, their gaming division experienced a 7% decline in revenue. The earnings, ending on December 31, 2024, showed an overall revenue increase to $69.6 billion, highlighting a notable drop of 29% in Xbox hardware revenue. However, Xbox’s content and services revenue saw a 2% growth, driven by the success of Xbox Game Pass.

During the earnings call, Satya Nadella, Microsoft’s CEO, emphasized the focus on enhancing business profitability for long-term growth through high-margin content and platform services. Notably, Xbox Cloud Gaming recorded a milestone of 140 million hours streamed in the quarter, showcasing the platform’s strong traction. Additionally, there was an increase in revenue and PC subscribers for Game Pass.

The success of the game “Call of Duty: Black Ops 6” during its launch contributed positively to Microsoft’s gaming sector, along with “Indiana Jones and the Great Circle,” which attracted more than four million players since its release. The game launched on December 9 for Xbox Series X, Xbox Series S, and PC.

In other related news, there are exciting prospects for Xbox Series X games in 2025, the return of the Future Games Show in March, and reports that Grand Theft Auto 6 will run at 30FPS on PS5 and Xbox Series X.