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Microsoft Gaming CEO Phil Spencer at The Wall Street Journal’s Tech Live conference revealed that the company’s Xbox Game Pass subscription service is profitable and accounts for about 15 percent of the company’s overall Xbox content as well as services revenue.
“Game Pass as an overall part of our content and services revenue is probably 15 percent,” says Spencer. “I don’t think it gets bigger than that. I think the overall revenue grows so 15 percent of a bigger number, but we don’t have this future where I think 50–70 percent of our revenue comes from subscriptions.”
Spencer added, “I think it will stay in that 10-15 percent of our overall revenue, and it’s profitable for us.” Spencer added that Microsoft has recently seen “incredible” growth on PC. “We’re seeing incredible growth on PC … On console, I’ve seen growth slow down, mainly because at some point you’ve reached everybody on console that wants to subscribe,” explains Spencer.
Spencer also noted that mobile would play a major role in the future of Game Pass. “If you take a long-term bet, which we’re doing, that we will be able to get access to players on the largest platforms that people play on — Android and iOS phones — we want to be in a position with content, players, and storefront capability to take advantage of it,” he said.
Microsoft in its earnings report for the first quarter of the 2023 fiscal year, which ended up September 30, 2022, revealed Xbox gaming revenue reached $3.61 billion. Microsoft CEO Satya Nadella talso revealed the number of PC Game Pass subscribers has grown by 159 percent year-over-year.
Recently, Xbox Game Pass PC introduced more games that are coming to PC Game Pass. The games for PC were announced during the QuakeCon 2022 event which will go on till August 21. Microsoft’s acquisition of Bethseda has opened the gates to a flurry of their classics.
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