Xbox FY24 Q4 gaming revenue up 44% year-over-year, mostly thanks to the Activision Blizzard acquisition

What you need to know

• Microsoft shared its financial results for FY24 Q4, the quarter ending June 30, 2024.
• Gaming revenue was up 44%, with growth coming from the acquisition of Activision Blizzard King compared to 2023. 
• Xbox content and services revenue was up 61% year-over-year. 
• Xbox hardware revenue is down 42% year-over-year.

The largest gaming acquisition in history continues to shape the picture of Microsoft's financial results. 

Microsoft shared its financial results for FY24 Q4 on Tuesday, outlining details across the company's divisions and revealing that gaming revenue was up 44% year-over-year. Like in FY24 Q3 and FY24 Q2, this boost is primarily driven by the acquisition of Activision Blizzard King, which Microsoft completed in October 2023.

Xbox content and services revenue is up 61%, mostly (but not entirely) driven by the acquisition of Activision Blizzard King. Meanwhile, Xbox hardware revenue is down 42% year-over-year. Overall, Microsoft saw $64.7 billion in revenue for the quarter.

Speaking on the accompanying earnings call, Microsoft CEO Satya Nadella noted that Xbox games have over 500 million monthly active users, while praising the Fallout TV series on Prime Video, pointing to it as an example of using a different medium to expand a gaming franchise's audience, as hours played for Fallout games on Xbox Game Pass increased 5x after the show's launch.

How has Activision Blizzard King changed Xbox revenue?

Ever since Microsoft finalized its acquisition of Activision Blizzard King on Oct. 13, 2023, it changed the following year of financial results. This move brought previously third-party revenue for games like Call of Duty and Diablo 4 in-house, altering how things were accounted for. As a result, we're seeing a one-time gargantuan boost to the year-over-year numbers that Microsoft reports, as these quarters are being directly compared to a prior quarter that didn't have those games as first-party titles.

Integration of Activision Blizzard King into the rest of Xbox has progressed throughout 2024, with the publishers taking part in Microsoft's Xbox Games Showcase for the year and revealing that Call of Duty: Black Ops 6 would be available day one on Xbox Game Pass Ultimate when it launches on Oct. 25, 2024.

Microsoft has begun to place games from the Activision Blizzard King catalog in Xbox Game Pass, with Diablo 4 being added back in April and Call of Duty: Modern Warfare 3 (2023) being added to the service recently, while reports indicate the Crash Bandicoot N. Sane Trilogy is also coming soon.

Looking ahead, Microsoft maintains a strong lineup of upcoming games such as Avowed, Indiana Jones and the Great Circle, and more from across Xbox Game Studios and Bethesda Softworks, which currently do not have exact release dates but are slated to arrive at some point in 2024. 

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