Xbox Sees Record Q1 for Revenue Due to First-Party and Game Pass, Hardware Revenue Drops 7% - Sales
by William D'Angelo , posted on 01 November 2023 / 8,672 Views
Microsoft has released its earnings report for the first quarter of the 2024 fiscal year, which ended up September 30, 2023.
Xbox gaming revenue increased by $309 million or nine percent year-on-year due to "growth in Xbox content and services."
Xbox content & services revenue increased 13 percent. This was due to "growth in first-party content and Xbox Game Pass." Xbox hardware revenue declined seven percent due to lower number of consoles sold that was partially offset by higher price of consoles sold.
Xbox gaming revenue and Xbox content & services both beat the forecast, which was mid single digits and mid to high single digits, respectively. This was due to the strong launch of Starfield. This was also the highest ever quarter one for Xbox gaming revenue with an estimated $3.9 billion in revenue.
Microsoft CEO Satya Nadella revealed the launch of Starfield led to a single day record of new Xbox Game Pass subscriptions. The latest game from Bethesda has surpassed 11 million players and nearly half of all hours played were on PC.
Overall, Microsoft reported for the quarter GAAP revenue up 13 percent year-over-year to $56.52 billion and net income up 27 percent to $22.29 billion.
Microsoft's forecast for the second quarter of the 2024 fiscal year expects to see major growth thanks to the completion of the Activision Blizzard acquisition. Total Xbox gaming revenue is expected to grow in the mid to high 40's (45%-49%) and Xbox content & services revenue to grow in the mid to high 50's (55%-59%).
A life-long and avid gamer, William D'Angelo was first introduced to VGChartz in 2007. After years of supporting the site, he was brought on in 2010 as a junior analyst, working his way up to lead analyst in 2012 and taking over the hardware estimates in 2017. He has expanded his involvement in the gaming community by producing content on his own YouTube channel and Twitch channel. You can contact the author on Twitter @TrunksWD.