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- Xbox has been showing less interest in the console market for a while now.
- Microsft’s CFO has now made it clear that the parent company wants to turn it into a subscription business.
- She also revealed that the company is satisfied with how well Game Pass is performing.
Not too long ago, Microsoft was rumored to be moving away from the console business. This caused concerns among the fans, but later, Xbox reassured the fandom that it had no plans to discontinue the hardware business.
The gaming giant plans to release next-gen consoles in 2026, featuring the biggest technical leap yet. However, the Microsoft CFO has shared her own vision for the future. She aims to turn Xbox into a subscription business.
Why it matters: Fans have been concerned about Xbox’s relevancy in the console market, but it seems the gaming giant is bound to become a subscription-based business.
In a recent investor call, Amy Hood, Microsoft’s chief financial officer, was asked what investors should think about Microsoft’s gaming growth.
Microsoft was asked how investors should be thinking about the long-term growth potential of the gaming business, particularly after the recent investment in Activision Blizzard.
The CFO replied that the real goal is to bring more content to users in more places.
I think the real goal is to build what looks like a software annuity and subscription business.
-Amy Hood
Hood has defined this as the real goal, so it seems the company is indeed heading in this direction.
This is also because, according to recent reports, Microsft’s gaming revenue is up 44% compared to last year, and the revenue from Xbox content and subscription services is up by a whopping 67%.
Meanwhile, hardware revenue declined by 42%. This shows exactly where Microsoft’s priorities lie. Amy Hood has clarified that Microsoft wants Xbox to focus more on its subscription services.
So, you can expect more emphasis on Game Pass, meaning that more and more IPs will be launched on this service. To convince the investors, Hood also said that the company is encouraged by some of its progress with Game Pass.
Overall, Microsoft is pleased with how Game Pass is performing, but the same can’t be said for the hardware side.
Call of Duty Modern Warfare 3 is already on the subscription service, and Black Ops 6 will have a day-one launch. Many games revealed in the previous showcase will be launched on day one for the Ultimate tier, highlighting further priorities.
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[News Reporter]
Obaid is pursuing a Law degree, while working as a content writer. He has worked as a gaming writer for over a year because of his passion for the medium and reporting the latest updates in the industry. Having played hundreds of games, Obaid finds himself coming back to Elden Ring and Red Dead Redemption 2, with these games being among his favorites. He has also been mentioned on highly regarded websites, such as Wccftech, Metro UK, PS Lifestyle, GamePressure, VGC, and Gamespot.
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