Microsoft’s Xbox Game Pass service is profitable, accounting for approximately 15% of the company’s total Xbox content and service revenue.
In an on-stage interview at The Wall Street Journal’s Tech Live conference, Microsoft Gaming Chief Phil Spencer revealed the tidbit of information (via The Verge).
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“Game Pass as an overall part of our content and services revenue is probably 15 percent,” he told The Journal’s Sarah Needleman. “I don’t think it gets bigger than that.
“I think the overall revenue grows so 15 percent of a bigger number, but we don’t have this future where I think 50 to 70 percent of our revenue comes from subscriptions.”
Spencer added that Microsoft has recently seen “incredible” growth on PC, with console uptake slowing due to saturation. “… at some point, you’ve reached everyone on the console who wants to subscribe,” he explained.
Microsoft announced earlier this week that PC Xbox Game Pass subscriptions increased by 159 percent year on year during the first quarter of 2023.
People are also streaming more games through Microsoft’s Xbox Cloud Gaming platform. Spencer hinted that mobile would play a significant role in Game Pass’s future.
“If you take a long-term bet, which we’re doing, that we will be able to get access to players on the largest platforms that people play on — Android and iOS phones — we want to be in a position with content, players, and storefront capability to take advantage of it,” he said.
That statement alludes to the recent disclosure that Microsoft wants to build an Xbox store that’s available on mobile devices.
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Spencer was also adamant that the price of Game Pass would go up at some point. “We’ve held price on our console, we’ve held price on games and our subscription,” he said. “I don’t think we’ll be able to do that forever.”
Companies like Microsoft don’t often share figures like the ones Spencer did earlier today. They discuss how important services like Game Pass are to the company’s bottom line and how they envision the product evolving in the future.
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