The days of a true console war are long since over as PlayStation has emerged as the clear leader, and the latest news out of Microsoft only goes to show how decisively things have been settled. After creating a genuine rivalry with the PlayStation 3 and Xbox 360 generation, the gap for PlayStation had grown to nearly double for PlayStation 4 and Xbox One, and now the Xbox Series X|S is failing to match even that performance.
The big problem for Microsoft has come in recent years, with the two consoles having similar trajectories, albeit with PlayStation still in the lead for its first two years on the market. Unfortunately for Xbox sales numbers, the console first remained relatively steady, then began to tail off in the intervening years, while numbers for the PlayStation 5 have taken off.
Now Microsoft has posted its latest earnings results, and the numbers show that the juggernaut’s gaming division is serving as a source of drag on the company’s otherwise upward trajectory, with overall year-on-year growth of 17% despite a 9% drop in gaming revenue over the same period, according to reporting from Gamespot. Before you shed any tears for the beleaguered tech giant, the company did still post revenue totals of $81.3 billion in the quarter.
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Streaming Grows More Critical To Xbox Gaming As Console Sales Sag And Exclusives Go Public
The consoles are clearly a big part of the decline reported by Microsoft Gaming, but that doesn’t mean they’re the only source of lower revenue generation for Microsoft compared to last year. Microsoft claims confidence in Game Pass growing to provide an increasing source of steady income, but even with improved Game Pass numbers factored in, there was still a 5% decrease in revenue from content and services, meaning game sales, DLC, and the streaming subscription service.
The decline in this sector appears to be less of a concern for Microsoft, however, with the company confident that the Game Pass service will continue to grow in the year ahead. Microsoft also notes that some of the decline can be attributed to a strong year in games last year, with Q3 projections pointing to a similar dip for similar reasons.
This is not necessarily bad news for gamers, at least those not strongly invested in the console war. One way that Microsoft has sought to increase video game revenue despite flagging hardware sales is by branching out with former exclusives, such as the Halo series having a PlayStation release for the first time this year, and the Fable reboot being a dual console release. Sadly for baseball-loving gamers who went down the Xbox route this generation, there are no signs of a reciprocal move of The Show onto the Microsoft console.
