Microsoft CEO Satya Nadella Reaffirms Gaming Strategy and Plans to Invest More
– 2 min read
In Microsoft's annual report, CEO Satya Nadella reaffirmed the current Xbox strategy. He said that the company now has 20 franchises that have generated over $1 billion in lifetime revenue and will continue to invest in games and studios. On the one hand, Microsoft will continue to produce exclusive content, but on the other, Xbox content will also be available on other platforms.
Gaming played a strong role in Microsoft's annual report, with Microsoft Chairman and Chief Executive Officer Satya Nadella reiterating the company's commitment to bringing more games to more people on more devices. "With our acquisition of Activision Blizzard King, which closed October 2023, we've added hundreds of millions of players to our ecosystem. We now have 20 franchises that have generated over $1 billion in lifetime revenue — from Candy Crush, Diablo, and Halo, to Warcraft, Elder Scrolls, and Gears of War," he said. Nadella described cloud gaming as an innovation that brings games to where the players are. Commenting on the release of four Xbox games on Switch and PlayStation, he said that "we continue to extend our content to new platforms". As competitors in the Xbox and cloud gaming space, he mentioned Amazon, Apple, Meta and Tencent, but also named providers of entertainment services such as video streaming platforms.
Satya Nadella: "We believe our gaming platform is effectively positioned against, and uniquely differentiated from, competitive products and services based on significant innovation in hardware architecture, user interface, developer tools, online gaming and entertainment services, and continued strong content from our own first-party game franchises as well as other digital content offerings. (...) We continue to invest in new gaming studios and content to expand our intellectual property roadmap and leverage new content creators. These unique gaming experiences are the cornerstone of Xbox Game Pass, a subscription service and gaming community with access to a curated library of over 400 first- and third-party console and PC titles."
The Microsoft CEO continues to see exclusive games as a growth driver for Xbox. "Growth of our Gaming business is determined by the overall active user base through Xbox enabled content, availability of games, providing exclusive game content that gamers seek, the computational power and reliability of the devices used to access our content and services, and the ability to create new experiences."
In the past fiscal year (1 July 2023 to 30 June 2024), Microsoft generated gaming revenue of $21,503 million, 39 per cent more than in the previous year (2023: $15,466 million; 2022: $16,230 million). The gaming segment thus accounts for almost nine per cent of the company's total revenue ($245,122 million). Xbox content and services revenue increased 50 per cent, driven by a net impact of 44 points from the Activision Blizzard acquisition. The net impact reflects the change in Activision Blizzard content from third party to first party. Xbox hardware revenue decreased 13 per cent due to lower unit volumes. Besides that, Microsoft as a whole benefited in the areas of Intelligent Cloud driven by Azure and Productivity and Business Processes driven by Office 365 Commercial.
Never miss anything from the German, Swiss and Austrian games industry again: subscribe for free to our Daily newsletter and get all news straight to your inbox.
Written by
