Microsoft earnings soar thanks to Activision Blizzard while Xbox sales keep declining

After some issues last year, Microsoft finally acquired Activision Blizzard. This brought numerous benefits, including an increase in the company’s annual income to over 20 percent. But Xbox console sales have not increased for two years straight. This was all part of the latest financial report.

Microsoft released the financial reports for this quarter, which ended on March 3, revealing an income of $61.9 billion, an increase of 17 percent from the same period last year with a net income of $21.9 billion. This means thanks to the Activision Blizzard acquisition, the company has now experienced 20 percent year-on-year growth.

This is the second year that Microsoft has included Activision Blizzard in its income results. The company became the third-most successful division under this brand, making a sensible decision to acquire the gaming giant. Xbox services and content have grown by 62 percent year over year.

Even with all this growth regarding gaming content and services, consoles are not selling. Hardware sales dropped by 31 percent. The company has tried to make this happen with price cuts or by releasing more games, but it’s not working.

Microsoft’s CEO, Satya Nadella, said this will keep happening every year, admitting that hardware will not be the stronger selling point of Xbox. In the last couple of months, Xbox’s strategy has changed drastically. The idea is to be more focused on software than hardware and really bet on Game Pass.

Phil Spencer confirmed this Game Pass will reach 34 million subscribers this year. The idea is that the Xbox brand consolidates into an ecosystem where gamers can enjoy every kind of experience. The company will continue to sell hardware, but it will also release more digital-based consoles.

The company is even considering releasing more exclusive titles on other platforms to keep sales growing for software-related things on the Xbox. Sarah Bond, Xbox’s president, has even talked about the possibility of a portable console. Microsoft really wants to recover a more solid player base.