Xbox: Declining Revenue Ahead of Call of Duty: Black Ops 7

General news News Xbox Xbox News 10/31/2025

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Ahead of this year’s Call of Duty release, Microsoft’s gaming division is not performing particularly well financially, but things are looking up!

In its latest financial report, Microsoft revealed that Xbox game revenue fell by $113 million (2%) in the first quarter of fiscal year 2026 compared to the previous year due to declining hardware sales and limited growth in game content and services. (The Redmond-based tech giant’s fiscal year begins in July, not April.)

On Wednesday, Microsoft released its results for the first quarter of fiscal year 2026. The results confirmed a 29% decline in Xbox hardware revenue, which was partially offset by growth in Xbox content and services. The division generated $5.5 billion in revenue, representing a 1% improvement over the previous year, which was considered strong. This growth was driven by Xbox Game Pass and third-party content but was partially offset by a decline in first-party content. In other words, Microsoft is lagging behind in terms of first-party games, while third-party titles are improving the balance sheet.

The decline in Xbox hardware sales is hardly surprising, as console sales fell 22% in the previous quarter. With the current generation coming to an end, rising prices, and a multi-platform strategy that brings flagship franchises such as Halo to the PlayStation 5, no improvement was expected. With all this in mind, it will be interesting to see what changes the next-gen Xbox will bring. The new console is said to offer a premium experience that combines the best of the PC and console worlds. However, its popularity could be affected by its expected high price, which is expected to be higher than that of the PlayStation 6.

Microsoft is not only increasing the price of its hardware, but also that of Xbox Game Pass. This could scare off quite a few gamers. Thanks to the multiplatform strategy, some games will be released on the same day for the PlayStation 5 as for the Xbox Series. It really won’t be easy for Microsoft to get everything back on track after all this.

Source: Wccftech, Microsoft

Angyal Anikó

Anikó, our news editor and communication manager, is more interested in the business side of the gaming industry. She worked at banks, and she has a vast knowledge of business life. Still, she likes puzzle and story-oriented games, like Sherlock Holmes: Crimes & Punishments, which is her favourite title. She also played The Sims 3, but after accidentally killing a whole sim family, swore not to play it again. (For our office address, email and phone number check out our IMPRESSUM)