Xbox hardware revenue down 30% compared to last year

(Image credit: Xbox)

Microsoft has announced its latest financial results, and the report indicates a big downturn in Xbox hardware revenue - though that downturn has been partially offset by growth across the rest of the Xbox brand.

"Xbox hardware revenue declined 30% on a prior year comparable that benefited from an increased console supply," Microsoft says in its earnings slides. This report covers the three months from January 1 through March 31, 2023, and compares against numbers for the same period in 2022.

Regardless of the hardware decline, "Xbox content and services revenue grew 3% driven by growth in Xbox Game Pass." Microsoft's overall gaming revenue was down by 4%.

It's a similar story to what we saw last quarter, with a hardware downturn again offset by Xbox Game Pass growth, but overall gaming revenue had taken a much larger 12% dive in that period.

Console warriors will be quick to put on their financial analyst hats to decide whether this spells doom and gloom for the current Xbox generation, but there are a host of factors that complicate any simple reading. We don't know the nature of Xbox's supply issues. We do know that Xbox Game Pass is a big focus for Microsoft's gaming endeavors, and that service is not exclusive to Xbox hardware.

Dustin Bailey joined the GamesRadar team as a Staff Writer in May 2022, and is currently based in Missouri. He's been covering games (with occasional dalliances in the worlds of anime and pro wrestling) since 2015, first as a freelancer, then as a news writer at PCGamesN for nearly five years. His love for games was sparked somewhere between Metal Gear Solid 2 and Knights of the Old Republic, and these days you can usually find him splitting his entertainment time between retro gaming, the latest big action-adventure title, or a long haul in American Truck Simulator.