Xbox Revenue Falls 2% in First Results Since Layoffs as Decline Narrows From 10%
Lower third-party sales and Game Pass revenue pulled content and services down, while Microsoft said hardware revenue fell 14% and the decline narrowed from the prior quarter.
- Microsoft reported Xbox content and services revenue declined 2% for the quarter ending September 30, 2026, while hardware revenue dropped 14% year-over-year, marking the fifth consecutive decline.
- Lower third-party game sales and Xbox Game Pass revenue pulled content and services down following a price cut implemented in April, while console hardware remains the division's weak spot.
- Operating expenses in the Devices and Consumer segment fell 3%, a decrease "driven by Xbox," reflecting Xbox CEO Asha Sharma's cost-cutting measures, including elimination of over 1,600 jobs.
- CFO Amy Hood expects Xbox content and services revenue to lift during the holiday period, though she anticipates hardware revenue will continue to fall as the division leans on PC growth.
- Microsoft reported total revenue growth of 19% to $92.3 billion, bolstered by Microsoft Cloud revenue surpassing $63B with 30% YoY acceleration; the company expects Xbox growth to peak in the October-December quarter.
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12 Articles
Xbox revenue falls 2% in first results since layoffs as decline narrows from 10%
Xbox revenue slipped again in the July–September quarter, its fifth straight decline, but the drop was much smaller than the quarter before. Console sales and Game Pass are still shrinking, and Microsoft is counting on the holiday quarter to bring Xbox's strongest growth.
Microsoft summarized the first quarter of fiscal year 2027. Xbox is losing again, but there is improvement, as the declines are smaller than before. The information "Xbox is losing on hardware and Game Pass. According to Microsoft, the problem with consoles is too low supply, not a lack of buyers" was published by GRYOnline.pl on October 29, 2026.
Microsoft has presented its quarterly results for the third quarter of this year (June to September 2026). Read more
Xbox Revenue Decline Narrows to 2% as Asha Sharma Points to Record Minecraft and WoW Results, but "Console Sales Remain Constrained by Supply"
Microsoft's Xbox business is still shrinking, but the pace of that decline has slowed considerably, as reported yesterday. In the company's fiscal first quarter ended September 30, Xbox revenue fell 2% year over year to $5.38 billion, an improvement from the 10% decline reported in the previous quarter. Xbox content and services revenue also fell 2%, while hardware revenue dropped 14%. In a tweet, Xbox CEO Asha Sharma framed the results as evide…
NewsGaming.net At Xbox, sales related to console sales and the Game Pass are down, but Asha Sharma wants to see the positive Microsoft just posted the results of its first quarter of the year, and [...] The article At Xbox, sales related to console sales and the Game Pass is down, but Asha Sharma wants to see the positive is available on NewsGaming.net
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