Xbox Series X|S Sales Drive Another Record First Quarter for Microsoft’s Gaming Segment

It’s another record quarter for Microsoft’s gaming segment, mostly because it is, unsurprisingly, selling a lot of expensive consoles to people.Microsoft has reported its earnings for Q1 of fiscal year 2022, and buried among the many non-gaming numbers is a note that its gaming revenue for the quarter was up $501 million — or 16% — from the same period last year. Checking out the prior year’s paperwork and doing some math puts last year’s Q1 at around $3.1 billion, and this year’s Q1 at $3.6 billion, a number that appears to be a new record in revenue for Microsoft’s gaming division.These gains are by and large driven by lots and lots of Xbox hardware sales, which were up 166% from the same quarter last year. Keep in mind that last year’s Q1, while also a record quarter, was largely software and Game Pass-driven. Microsoft wasn’t selling a lot of consoles then because the Xbox Series S and X weren’t out yet, and in expectation of their release, no one was buying the less expensive Xbox Ones.Have you played Xbox Series S?YESNOMeanwhile, its Xbox content and services revenue was nearly flat, up only 2% from last quarter thanks to a balance of more first-party game sales and Xbox Game Pass subscriptions (Microsoft sadly did not share exact numbers) and fewer third-party game sales. While this sounds unimpressive, last year’s content sales were through the roof due to COVID-19 lockdowns, so their maintenance into 2021 as the world has reopened is notable.28 Best Xbox Game Pass GamesWe did get a bit of color last week on Xbox Game Pass subscriptions in a separate financial statement, where Microsoft shared its subscription had risen over the last fiscal year by 37.5% — falling short of a targeted 47.8%. That’s still growth, just not as fast as Microsoft might have liked. The previous year, Game Pass subscriptions rose nearly 86% past its internal goal of 71% — again, helping account for that content and services revenue doing so well last year. The last concrete number Microsoft gave us for Game Pass subscribers was 18 million in January of this year.Rebekah Valentine is a news reporter for IGN. You can find her on Twitter @duckvalentine.



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