The company said Xbox hardware revenue grew 86% year-over-year, driven by the Xbox Series X/S launch.
Xbox content and services revenue was up 40% year-over-year thanks to the performance of third-party titles, Xbox Games Pass subscriptions, and first-party titles.
“The launch of Xbox Series X and Series S was the most successful in our history with the most devices ever sold in a launch month,” Microsoft CEO Satya Nadella said.
He also announced that Xbox Game Pass now has 18 million subscribers, up from 15 million reported in September 2020.
I know some seem disappointed by Game Pass numbers but I think MS reports conservatively on that front, and more importantly, they’re tracking well ahead of competitive subs and comparable services in the video industry.
Those Xbox sales numbers though are extremely impressive given the challenges faced from COVID and the manufacturing strain from PS5, Xbox, and all of AMD’s product releases in that timeframe. It’s great to see Xbox seeing such success early on when there’s arguably no killer next-gen exclusive experiences (especially the lack of first-party), and I think people are going to be surprised by the trajectory when those titles start dropping. As @TheRayTracer alluded to, Xbox is doing pretty damn great and all that talk from Satya about further acquisitions coming down the pipe are even more solid now.
I would imagine that Satya is very thankful that Phil was able to persuade him to keep MS in the gaming industry. These are seriously impressive numbers.
I can’t see a single reason for an indie, self-publishing developer not launch its game directly on Game Pass. As soon as the game launches it is exposed to 18 million people. Then the word of mouth do the trick to help selling on the other platforms.
Especially on this dry period when AAA games are few and far between.
With 18 million subscribers paying at least $10 a month we are already looking at a 2.1bi yearly revenue.
To put it in perspective, that’s a lot more money than GoW and Spiderman did on their 1st year, added up. (GoW made 500 million in revenue).
And unlike on unit sales there’s no degradation of price, so if someone 2 years from launch subscribes to play any game in the current catalog they still pay the same sub as everyone else.
That’s why it never made any sense to claim Sony games were too big for a subscription to make sense. This is simply a much better model that generates tremendously more revenue.
Contrary to what Jim Ryan says it is inevitable Sony will position PS Now more as a Gamepass competitor and to be fair he did say they have announcements to make in the future.
There is a reason why so many companies are going down the subscription route and that is because it almost guarantees you a constant, reliable source of revenue. Sony knows this but the issue they have is that Microsoft has got a leg up on them and some seriously big tech companies are moving into the space, so there could end up being a scenario whereby Sony is simply out muscled out of the subscription game.
They’re the most diverse tech company out there and don’t rely on any specific segment to be successful. They’re firing on all cylinders and that 15.5 Billion Net Profit (in three months!) is just bonkers.
Considering that MS’s 1st party offerings are still rather lackluster and I question how big their 2021 games will be in the context of gamepass (Halo will be big but otherwise???), this is really impressive.
Once the ball really gets moving on MS’s 1st party and you get 1 triple A game every 3-4 months I think the subscriber count is gonna skyrocket.
Think its safe to say factually that the Xbox series launch was a huge success and has smashed through all expectations. MS forecasted a 40% bump in hardware yet it’s 86%. The numbers all round is just insane. Microsoft are absolutely killing it all round and Xbox is now central to all this. Exciting times. But they absolutely nailed the series launch. Still very hard to buy one. Thank god they didn’t rush Halo out the door because it would have made absolute no difference. Imagine the money they will make when HI releases?
