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Microsoft Gaming Revenue Declines 7% YoY; Xbox Content and Services Revenue Relatively Unchanged

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Microsoft Gaming Revenue Declines 7% YoY; Xbox Content and Services Revenue Relatively Unchanged

Microsoft announced its financial results for the first quarter of the fiscal year 2020, related to the period between July 1 and September 30.

Today Microsoft announced its financial results for the first quarter of the fiscal year 2020, related to the period between July 1 and September 30.

First of all, we get an update on the performance of the More Personal Computing business, which includes Microsoft’s the gaming division and the Xbox brand.

We learn that gaming revenue has declined 7%, while Xbox content and services revenue remained essentially flat.

Among the positives Microsoft lists a strong performance on Minecraft, but it was offset by the comparison with a strong third-party game released in the same period last year.

Interestingly, the brief report also mentions investment made in gaming.

This month marks a relevant change in the way Microsoft reports its metrics. Absolute revenue isn’t reported anymore on the main documentation, replaced by the year-on-year variation in percentage. Xbox Live monthly active users also aren’t included in the report.

The form 10Q offers more details, including the fact that gaming revenue was 2,542 million dollars, which means a decline of 196 million from the 2,738 million dollars earned in the same quarter last year.

The decrease in hardware revenue was the main factor, with a 34% decline due mostly to selling less consoles. That’s not surprising considering that we’re officially at the end of a generation.

We then get an overview of the performance of Microsoft corporation as a whole. As you can see below, all the relevant figures are in the black, showing substantial improvement year-on-year.

  • Revenue was $33.1 billion and increased 14%
  • Operating income was $12.7 billion and increased 27%
  • Net income was $10.7 billion and increased 21%
  • Diluted earnings per share was $1.38 and increased 21%

If you want to compare, you can check out the results from the previous quarter (from April to June) published by Microsoft in July.

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