Xbox Game Pass and hardware sales push Microsoft gaming revenue up 11%

Gaming continues to return growth for Microsoft. The company reported its fourth-quarter earnings today, and game division generated $357 million more in the three-month period that ended June 30 than in the same period in the previous year. That is up 11% year-over-year. Hardware was the big winner, as Microsoft is selling a lot more Xbox systems that also cost a lot more money thanks to the start of the Xbox Series X/S generation. The excitement for that hardware also overcame a drag from content and services, which cooled off relative to last year.

“Xbox hardware revenue increased 172% driven by higher price and volume of consoles sold due to the Xbox Series X/S launches,” reads the Microsoft earnings report. “Xbox content and services revenue decreased $128 million, or 4%, driven by a decline in third-party titles on a strong prior year comparable that benefitted from stay-at-home scenarios, offset in part by growth in Xbox Game Pass subscriptions and first-party titles.”