Microsoft Expects Gaming Revenue to Decline, According to Latest Earnings Call

Microsoft released its fiscal year 2025 Q4 financial report on July 30, and accompanying it is an earnings call transcript clarifying some of the numbers in the report. According to Amy Hood, chief financial officer of Microsoft, the company expects the gaming division’s revenue to decline.

“We expect revenue to decline in the mid to high single digits,” Hood said, per the transcript. She also added that the company expects both Xbox content and services to decline in the mid-single digits.

These outlooks were made after Microsoft’s gaming revenue increased by 10% and Xbox content and services revenue grew by 13%. Xbox hardware sales have been impacted hard this quarter, as they suffered a 22% decline in revenue.

It’s worth noting that this quarter marked the release of high-profile games such as Doom: The Dark Ages, Clair Obscur: Expedition 33, The Elder Scrolls IV: Oblivion Remastered and South of Midnight.

In the transcript, Satya Nadella, CEO of Microsoft, said that Microsoft currently has “nearly 40 games in development” and that it has surpassed 500 million hours of gameplay streamed via cloud this year. Additionally, he highlighted the success of the Call of Duty and Minecraft franchises, which continue to grow.

Finally, Nadella said that Microsoft’s subscription program, the Xbox Game Pass, has generated the company “nearly $5 billion for the first time.” Hood later said that this is a “better-than-expected performance.”