Acquisition of Activision Blizzard Has Increased Microsoft’s Revenue But Console Sales Are Going Down

The acquisition of Activision Blizzard has helped increase the revenue of Microsoft’s gaming division but at the same time, hardware sales have plummeted.  Xbox’s console sales have taken a setback.

According to a new revenue report, the gaming revenue of Xbox has increased by 1.8 Billion. At the same time, the services revenue has increased by 62% which is a major increase in the earning. All of it has been made possible due to the Activision Blizzard which has been acknowledged by Microsoft.

At the same time, hardware revenue has moved in the opposite direction. It has decreased by 31% due to the plummeted sales of the Xbox consoles. The release of big exclusives such as Starfield did not do much to increase the sales of Xbox consoles.

Consoles are a gateway to a store and that’s where the console makers generate revenue. Last year, the company reported a reduction of 30% in hardware sales drop. Such losses can pile up and have a major impact on the future plans of the consoles. It should be kept in mind that there is no mention of the number of subscribers of Xbox Game Pass.

Earlier this year the head of Microsoft Gaming Phil Spencer, laid down his concerns about the lack of growth in the gaming industry. This lack of growth is attributed to the mass layoff in Microsoft games this year. The numbers prove this lack of growth for the console maker. It is one of the main reasons that Xbox is releasing games on their rival, PlayStation. The release of Sea of Thieves and Grounded proves that fact.

The Impact

The impact of Activision Blizzard’s acquisition was also seen in the operating income of the company. It increased by 16% for the overall Microsoft. The operating expenses rose by 1.3 billion due to the growth that the company saw through the Activision Blizzard acquisition.

It should be noted that Microsoft completed its acquisition of Activision Blizzard in October 2023. Microsoft paid 68.7 billion for this acquisition, making it the biggest video game purchase in history. With this latest report, we are seeing the impact of that decision.