Microsoft recently published its reports for the fourth quarter of the fiscal year 2023. The report shows their earnings in the past quarter, highlighting the progress of Xbox consoles and Game Pass.
According to the report, Xbox console revenue is down by a staggering 13% in the console’s third year of its life cycle.
Why it matters: Xbox is already behind PlayStation when it comes to home console sales. Therefore, the gaming giant needs to take immediate action to improve the decreasing sales figures.
The declining Xbox Series S|X console sales can likely be attributed to the poor first-party offerings from Microsoft in the previous months.
While the gaming giant has released titles like Hi-Fi Rush, much-anticipated games like Redfall performed well below expectations. Big hitters like Starfield were also delayed, leading to underwhelming sales.
While console sales did not thrive, Xbox performed well in other fields. Microsoft’s gaming revenue increased by 1% ($34 million), with content and services revenue increasing by 5% thanks to Game Pass and an increase in 3rd-party content.
On the other hand, PlayStation seems to be excelling in console sales. In Q1 of 2023, which lasts from January to March, Sony shipped out 6 million PlayStation 5 console units, setting a new record.
They also sold over 533,000 units in February, breaking an 18-year record. PlayStation’s sales are expected to continue increasing as they have plans to release Project Q, a handheld console, and an alleged PlayStation 5 slim model later this year.
Still, Microsoft reportedly does not plan to release a new variant, as the gaming giant already believes that the Xbox Series X is the mid-gen refresh.
Previously, Xbox stated that it lost the console war. However, things could turn around for the gaming giant. Xbox console sales have recently surged thanks to improvements to older Call of Duty titles.
Furthermore, Microsoft is set to acquire Activision Blizzard, which could help it build a strong first-party catalog in the coming years.
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