According to the latest financial report from Microsoft, Xbox is seeing a decline in total revenue from it’s previous quarter–in the last three months ending March 31, 2026, the Gaming revenue has decreased by 7%, Xbox content and services revenue has reduced by 5% and Xbox hardware revenue has declined by a total of 33%.
And it’ll probably be the last figure that’s particularly worrying for the new Xbox CEO as both the Xbox Series X and Series S consoles have been struggling for quite some time, especially compared to Sony’s consoles and reversing the declining hardware sales will definitely be a tall order for everyone involved.
“Xbox earnings today. While we have made progress expanding the business and our margins, player and revenue growth has not yet met our ambition. We know we have work to do to earn every player today and into the future,” CEO Asha Sharma wrote on Twitter/X.
And during Microsoft’s financial call, CEO Satya Nadella has stated that the “foundational work required to win back fans and strengthen engagement across Windows, Xbox, Bing, and Edge” is being done at the company.
“In the near term, we are focused on fundamentals, prioritizing quality and serving our core users better,” he continued. “You see this in the work underway across our consumer products.
“And you also see this in Xbox where the team is recommitting to our core fans and players, and shaping the future of play. Last week’s Game Pass changes are one example of how we are staying responsive to customer feedback.”
Xbox is currently undergoing some huge changes that’ll affect many of the platform’s core elements including modifications on the pricing of multiple Game Pass tiers, re-evaluating the exclusivity of many of it’s landmark titles and more. The platform has also slightly reduced the prices for both Xbox Game Pass Ultimate and PC Game Pass recently, which would widen the accessibility of the subscription service to players. All of these definitely seem hugely ambitious and pivotal for the Xbox brand and it’ll be interesting to see how Microsoft executes these changes moving forward.
