Xbox Console Sales Drop Revealed in Q3 2024 Earnings Call

Microsoft has posted its financial results for the first three months of 2024, and it’s not looking good for Xbox console sales!

So far this console generation, Xbox has been lagging behind PlayStation in terms of market share. According to VGChartz, Sony’s console has sold around double the total 27 million Xbox Series X and S sales.

Unfortunately for Xbox, the gap in consoles sold will continue to get bigger, judging by the latest financial figures. However, Microsoft’s Q3 2024 earnings call isn’t all bad news for its gaming division.

A Bad Quarter for Xbox Series X & S Sales

In its Q3 2024 earnings release, Microsoft reported that Xbox hardware revenue decreased by 31% in the three months leading up to March 31, 2024. This is compared to the previous quarter, which ran from October to December 2023.

The report states that the drop in hardware revenue was “driven by a lower volume of consoles sold”.

While a dip is to be expected after the busy Christmas period, a drop of 31% will no doubt be disappointing for Xbox.

Despite the disappointing console sales, it is still overall good news for Xbox’s finances. This is because the company’s gaming revenue increased by $1.8 billion, or 51%, in the first three months of 2024, compared to the last quarter.

The main reason behind this is the acquisition of Activision Blizzard. This has brought the huge revenue streams of games like Call of Duty into the Xbox gaming revenue.

Additionally, the ongoing growth of Game Pass is another important factor, as the service now has over 34 million subscribers.

As Xbox pivots its focus to multiplatform gaming through Game Pass and Cloud Gaming, we expect this trend to continue. The console is certainly not a thing of the past just yet, but Xbox’s growth will clearly come in the form of Game Pass and software sales rather than hardware from now on.

However, leaks suggest that Xbox could release a digital-only Series X later this year. This could be a much-needed boost for the company’s hardware sales!