Xbox software revenue rises as console sales continue to fall

2025 has been a weird year for Microsoft, with the Xbox maker continuing to bring more and more games to other platforms, while still doubling down on the future of Xbox as a brand. With Microsoft owning so many publishers however, it comes as no surprise that ‘Xbox’ as a whole is continuing to grow – despite a free-fall in console sales.

As part of the company’s latest FY25 Q4 financial reports (collated by The Verge), Microsoft offered an update on its software and services, revealing that “Xbox content and services revenue grew 13%” while overall “gaming revenue grew 10%.”

In an unsurprising announcement however, the console maker revealed that hardware revenue in particular has fallen by 22% this quarter.

Of course, Microsoft has not shared any console sales figures for the past two generations, and so contextualising these numbers is somewhat challenging.

This of course comes in the wake of the recent mass lay-offs at Microsoft, which saw almost 10,000 employees being unceremoniously fired (which itself was just the most recent string of lay-offs).

That said, Microsoft made sure to note that its shareholders are still being taken care of, announcing that $9.4 Billion was given to them in the form of dividends this quarter.

It will be interesting to see whether the upcoming release of the ROG Xbox Ally manages to make a positive impact on Microsoft’s console sales.

KitGuru says: What do you think of Microsoft’s latest fiscal results? How many Xboxes do you think have actually been sold this generation? Let us know down below.

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