Microsoft’s Xbox division has achieved record-breaking gaming revenue for Fiscal Year 2024, fueled by the transformative acquisition of Activision Blizzard King. The $70 billion merger, finalized in 2023, has already had a monumental impact on Xbox’s financial performance, with Activision Blizzard King’s contributions exceeding $1 billion in three consecutive quarters.
Xbox’s FY24 gaming revenue reached a staggering $21.524 billion, marking a substantial 39% increase compared to FY23’s $15.446 billion. This remarkable growth can be attributed to the strong performance of high-margin segments like game sales, subscriptions, services, and in-game purchases, collectively known as Content & Services.
Content & Services generated an impressive $18.579 billion throughout FY24, accounting for a whopping 87% of total earnings. This segment saw a significant 53% year-over-year growth, with Activision Blizzard King playing a pivotal role.
In contrast, the Hardware segment, which includes console sales, experienced a slight decline of 13% year-over-year, reaching $2.872 billion. While console sales revenue dipped by 45% in the fourth quarter, the overall hardware earnings for the full year remained above the 13% decline. Notably, hardware only represented 13% of Xbox’s total FY24 earnings.
The acquisition of Activision Blizzard King has proven to be a strategic success for Microsoft, solidifying its position as a leading player in the gaming industry. As Xbox continues to integrate Activision Blizzard King’s assets, its future earnings are expected to remain robust, further expanding its market dominance.
