Xbox gaming and hardware revenue are down for FY23 Q2

If it's any consolation, the Game Pass subscriber base grew amidst the lack of big releases on the Xbox platform.

xbox revenue down fy q
Minecraft Legends is one of the exclusives coming to the Xbox Series S/X this year.

Xbox doesn't have many big games coming to its platform. But, while the Xbox has a glaring lack of exclusives and big titles, it at least had a few that made the console worth gaming. The last quarter saw none of that and it's had a negative impact on the company's revenue.

According to the second quarter financial results for the 2023 fiscal year, Xbox gaming and hardware revenue declined by 13% overall while the first-party software and monetization in third-party games dropped by 12%.

The drops are said to be in line with expectations when compared to FY22 Q2 which saw the release of Halo Infinite, Forza Horizon 5, and Age of Empires 4. In comparison, the Xbox's lone first-party title for FY23 Q2 is Obsidian Entertainment's Pentiment.

However, this decline is "partially offset by growth in Xbox Game Pass subscriptions," although the company declined to say by how much. It's worth noting that the Game Pass missed its growth rate for the second year in a row last year and will likely go for a third straight year given the current trajectory of the service.

xbox revenue down fy q
The Xbox Series S/X desperately needs to have more exclusives than Microsoft is willing to give it.

Microsoft is currently dealing with mass layoffs amidst a down year for pretty much the entire industry. However, the tech giant can only blame itself for the lack of releases.

For all of its new and ongoing acquisitions, Microsoft has little to show for them. Redfall and Starfield could've done a lot for the Xbox last quarter but they were delayed to a still-unrevealed date later this year.

Xbox Series S/X owners and Game Pass subscribers are hoping that the upcoming Xbox & Bethesda showcase will address this issue.

The Xbox Developer Direct showcase, which takes place tonight, January 25, is the company's first major gaming event ever since last year's Xbox and Bethesda Games Showcase.

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Ray Ampoloquio

Ray Ampoloquio // Articles: 5882

Ray is a lifelong gamer with a nose for keeping up with the latest news in and out of the gaming industry. When he's not reading, writing, editing, and playing video games, he builds and repairs computers in his spare time. You can find Ray on Twitter and LinkedIn.
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