Microsoft’s latest financial report reveals that its gaming division, Xbox, has achieved record-breaking annual revenues, thanks in part to the acquisition of Activision Blizzard King. The Xbox brand generated $21.5 billion in revenue during the fiscal year ending June 2024, a remarkable 39% increase year-over-year. This growth was primarily driven by software, services, subscriptions, and monetization, collectively known as Content & Services. While hardware revenue declined slightly by 13% to $2.87 billion, the significant growth in Content & Services propelled Xbox to a new revenue peak.
Activision played a crucial role in this achievement, helping Xbox surpass the $20 billion mark. However, to gain a clearer understanding of Xbox’s performance without Activision, we can analyze the financial data. By subtracting the revenue contribution of Activision from the total Xbox revenue, we find that Xbox’s growth without Activision would have been around 2%, resulting in approximately $15.795 billion in revenue. This figure falls short of Microsoft’s previous best year for gaming, FY22, which reached $16.23 billion.
This analysis highlights the significant impact of Activision on Xbox’s overall growth. While the acquisition has undoubtedly boosted revenue, it’s important to consider Xbox’s inherent performance in the context of this acquisition. While Activision contributed roughly 27% to the overall revenue, it’s crucial to understand how this acquisition will shape the future of Xbox and its competitive landscape.
