Xbox business reports surging revenue on the back of Series X/S

Microsoft’s gaming business has reported a surge in quarterly revenue on the back of the Xbox Series X/S launch.

On Tuesday, the company announced its results for the second financial quarter ended December 31, 2020.

Boosted by the launch of its next-gen consoles on November 10, Microsoft’s quarterly gaming revenue was up 51% year-over-year.

The company said Xbox hardware revenue grew 86% year-over-year, driven by the Xbox Series X/S launch.

Xbox content and services revenue was up 40% year-over-year thanks to the performance of third-party titles, Xbox Games Pass subscriptions, and first-party titles.

Microsoft claimed in September 2020 that Xbox Game Pass subscribers had topped 15 million and that Xbox Live had over 100 million monthly active users. It could provide updated figures during a conference call on Tuesday.

UPDATE: During its earnings call, Microsoft said Xbox Series X/S recorded the biggest console launch in the company’s history as quarterly gaming revenue surpassed $5 billion for the first time.

“The launch of Xbox Series X and Series S was the most successful in our history with the most devices ever sold in a launch month,” Microsoft CEO Satya Nadella said.

He also announced that Xbox Game Pass now has 18 million subscribers, up from 15 million reported in September 2020.

ORIGINAL STORY CONTINUES: Last week the company announced plans to increase the price of Xbox Live Gold memberships before quickly reversing the decision.

“We messed up today and you were right to let us know,” Microsoft said. “Connecting and playing with friends is a vital part of gaming and we failed to meet the expectations of players who count on it every day. As a result, we have decided not to change Xbox Live Gold pricing.

“We’re turning this moment into an opportunity to bring Xbox Live more in line with how we see the player at the center of their experience,” it added. “For free-to-play games, you will no longer need an Xbox Live Gold membership to play those games on Xbox. We are working hard to deliver this change as soon as possible in the coming months.”

Further reading

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Xbox Series X/S launch was ‘the most successful in Microsoft’s history’

Xbox Game Pass hits 18 million subscribers