Xbox {Hardware} Gross sales Plunge 32% YoY as Companies Preserve Gaming Division Afloat

Microsoft simply reported its This autumn 2025 outcomes, offering some attention-grabbing insights into its gaming ventures. The firm’s total quarterly income elevated by a formidable 17% in comparison with the identical interval final 12 months, reaching $81.3 billion. This development is primarily pushed by the robust efficiency of the cloud sector. However, Microsoft’s gaming divisions are experiencing challenges with declining income. In its Xbox unit, {hardware} income decreased by 32% year-over-year, considerably impacting the enterprise. The total Xbox division noticed a 9% decline, whereas Xbox content material and companies dropped by 5%. The companies part, which incorporates the Game Pass subscription, is the one space not experiencing a steep decline. By lately rising Game Pass subscription costs, Microsoft goals to offset a number of the {hardware} losses.

An attention-grabbing element from the earnings report is the Windows OEM and Devices sector, which reported a modest development of 1%. This is minor contemplating the Windows 10 end-of-life, which was anticipated to spice up this sector considerably. Windows itself reported a 5% development, however that is solely a slight enhance in comparison with what Microsoft anticipated from OEMs buying Windows license keys for Windows 11, in addition to a significant client improve spree to Windows 11 units. With Xbox income declining considerably year-over-year for a number of years, it’s changing into much less of a precedence for the corporate, which now derives substantial income from Microsoft Azure and 365 Commercial subscriptions.

The Productivity and Business Processes sector—which incorporates Microsoft 365 choices like Word, Excel, and PowerPoint—recorded income of $34.1 billion, a rise of 16%, offering a wholesome revenue for Microsoft. The Intelligent Cloud division, supported by Microsoft Azure cloud companies, recorded $32.9 billion in income, marking a 29% enhance year-over-year.