- Microsoft has just published its earnings report for Q2 2026, and things aren’t that great for the gaming division.
- Xbox hardware sales are down 32%, and overall gaming revenue fell by 9%.
- Hardware sales have been subpar recently, yet Microsoft is adamant about sticking to first-party hardware manufacturing.
Microsoft’s gaming division continues to falter by each day, and now, figures are reaching an embarrassing point. The tech giant has just published its Q2 earnings, and the gaming division took a significant toll.
Specifically for Xbox, hardware sales have stumbled by 32% and gaming revenue by 9%, showing that the gaming giant doesn’t really have a grip on the market even after going down the multiplatform route.
Why it matters: The era of Xbox Series X|S is already over, and Microsoft has also seemingly abandoned the current-gen consoles. The future of the brand really looks uncertain.
The overall revenue for Microsoft during the last quarter was $81.3 billion (a 17% increase), mostly driven by cloud computing. Unfortunately, the gaming division was the black sheep, and despite billions of dollars in investment in the sector and countless new releases recently, gaming revenue was still down 9%.
Xbox hardware being down is understandable considering it’s the most expensive console out there, and there’s no reason to buy an Xbox in this era. However, even with the publisher route, gaming revenue is down, which is the biggest surprise.
Content and service are also down by 5%, likely due to many abandoning Game Pass recently because of the price hikes. For the next few quarters, things will certainly improve for the gaming giant since they plan on releasing heavy hitters like Fable, Forza Horizon 6, Halo Combat Evolved Remake, Gears of War E-Day, and more.
For hardware, however, the gaming giant is still working on its next-gen console, reportedly a PC-console hybrid, aiming to close the gap between the two platforms. It’ll be interesting to see how that unfolds.
What are your thoughts on Microsoft’s gaming division’s performance in the last quarter? Please let us know in the comments below or on the official Tech4Gamers Forums.
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[Staff Writer]
Shaheer is currently pursuing a Business degree while also working as a part-time Content Writer. With his deep passion for both writing and video games, he has seamlessly transitioned into a role as a Journalist. Over the past two years, Shaheer has contributed as a freelancer to various websites and landed positions on acclaimed platforms like Gamerant. Currently, his role at Tech4gamers is as a Features Writer, but he also covers News occasionally. Shaheer’s favorite gaming franchises are Assassin’s Creed and the God of War series.
Get In Touch: shaheerzahid03@gmail.com
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