Microsoft has disclosed its financial results for Q2 2024, revealing substantial revenue growth in its gaming division, notably a remarkable 61 percent surge in Xbox content and services revenue. This uptick follows the completion of Microsoft’s $69 billion acquisition of Activision Blizzard.
According to the Q2 earnings release, Microsoft’s overall gaming revenue witnessed a 49 percent increase compared to the corresponding quarter in the previous fiscal year. The company specifically noted a 61 percent rise in Xbox content and services revenue, encompassing income from services like Game Pass, coupled with a three percent uptick in Xbox hardware revenue.
Unsurprisingly, the acquisition of Activision Blizzard played a pivotal role in Microsoft’s Q2 expansion, contributing over $2 billion to the revenue. However, the net impact of the Activision Blizzard deal, factoring in operating expenses and other costs such as transaction- and integration-related expenses, resulted in an operating loss of $440 million.
Microsoft’s most recent financial figures highlight gaming as the company’s third-largest business, generating over $7.1 billion in revenue for the latest quarter, as reported by The Verge.
The robust performance in gaming revenue comes on the heels of Microsoft’s announcement last week regarding the layoff of 1,900 employees from its video game teams, affecting personnel at Activision Blizzard, ZeniMax, and Xbox. Xbox CEO Phil Spencer characterized the cuts, amounting to around eight percent of Microsoft’s total gaming workforce, as a “painful decision.”
The same week witnessed Blizzard president Mike Ybarra’s departure from Microsoft, with former Call of Duty general manager Johanna Faries slated to assume the role.
