Yesterday, Microsoft revealed its earnings for the first quarter of the 2024 fiscal year. Although the overall revenue went up by 13 percent, gaming revenue specifically being an 8 percent increase, Xbox hardware sales have gone down by 7 percent.
The quarter started on July 1, 2023 and concluded on September 30, 2023, meaning Bethesda’s long-awaited venture into RPGs in space with Starfield was released during the period. Starfield launched on September 6, 2023 for Windows and Xbox Series X/S as Bethesda’s first original IP in 25 years. Players were quick to purchase, with the game surpassing 10 million players within a few weeks post-launch. From The Verge’s Tom Warren on X, formerly known as Twitter, Microsoft CEO Satya Nadella confirmed that Starfield was to thank for the boost in Game Pass subscriptions stating that its launch set a record for the most subscriptions purchased in a single day.
As the deal between the two was not finalized until October 13, 2023, the report does not include Microsoft’s acquisition of gaming powerhouse Activision Blizzard for $68.7 billion. The acquisition means that Microsoft is now owner of many iconic gaming franchises, including, but certainly not limited to Call of Duty, Candy Crush, Diablo, Overwatch, Hearthstone and World of Warcraft. Microsoft also now owns studios Infinity Ward, Raven Software, Sledgehammer Games, Toys for Bob, and Treyarch. The acquisition was led by Nadella, who states that with it, Microsoft has added “significant depth” to their portfolio. It has also allowed Microsoft to become the third-largest gaming company in the world, just behind Tencent and Sony.
For the second quarter of the fiscal year, Microsoft expects their gaming revenue to increase by roughly 45 percent, with Activision Blizzard’s inclusion counting for about 35 percent of it. Although Activision Blizzard games will not arrive on Game Pass till 2024, it is certain that players will continue supporting Microsoft through microtransactions, game purchases, and subscription services.