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Xbox games and consoles revenue is down a bit due to the lack of blockbuster releases

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After a few years of skyrocketing gaming revenue thanks to Xbox Series X and S sales, Microsoft’s gaming business seems to be slowing down a bit, and although a downturn was expected, the lack of major first-party game releases was a major culprit.

The company reported its Q2 earnings today, and for the first time in a while, Xbox posted a year-over-year decline, with gaming revenue down 13% year over year, hardware revenue specifically down, and overall Xbox content and services revenue down 12%. Microsoft attributed this decline to several factors: lower spending on first-party content, lower third-party content, and the previous year’s strength compared to the current year.

This puts Microsoft’s gaming division at roughly the same levels of revenue it saw in 2020-2021. And Xbox says subscriptions to Xbox Game Pass continue to grow.

Microsoft’s Xbox and gaming divisions are part of the Personal Computing division, which saw revenue of $14.2 billion, down 19% due to declines in multiple segments including gaming. Overall, Microsoft generated $52.7 billion in revenue, up 2% year-over-year.

Finally, CEO Satya Nadella added that the number of active monthly users of Xbox exceeded 120 million over the past quarter.

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