Microsoft Xbox sales dip in Q2 amid weak demand, supply chain woes

Microsoft Xbox sales dip in Q2 amid weak demand, supply chain woes

by Pranali Mehta

Sales from tech giant Microsoft’s video gaming service, Xbox, have reportedly fallen 7% on-year in the second quarter of 2022, with a 6% drop in revenue from its content and services, and an 11% drop in revenue from hardware.

This comes after the firm extended its deal with South Korean tech major, Samsung, in June, through which users owning the 2022 model of Samsung smart TV will have access to Xbox games without the need for the gaming console.

Users with the Xbox Game Pass can access all the titles available on the TV unit, similar to the previous deal through which Microsoft brought Xbox games to Samsung Galaxy smartphones. Wherein it offered its subscription service app on the Galaxy Store.

The move came amid a shortage in supply of consoles from not only Microsoft, but also its rival, Sony, due to disruptions in the global supply chain.

Game Industry Biz (GIB), which provides all news and information regarding the gaming industry, claims that the drop in sales is largely due to a global level of economic and supply chain issues.

The 11% drop in hardware revenues highlights the issue of the current climate, where PC gaming as well as mobile gaming are gaining much more traction over console gaming.

GIB believes that Microsoft is currently facing more demand-related issues as its Xbox Series S console is more budget-friendly than its counterparts.

Microsoft also reported that it has noted a decline in the level of engagement as well as in monetization.

Its subscription service Xbox Game Pass also reported a 6% drop in revenue from content and services despite increasing subscription numbers, which implies that the year saw weak game releases, with Elden Ring being the only major release from Xbox.

Many games that were slated to be released this year have had their dates pushed to next year by publishers.

According to reports, the reason behind the setback in releases by Microsoft is likely due to the firm’s ongoing battle in bringing up its first-party and platform-exclusive development pipeline, which it had been neglecting so far, from scratch.

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Pranali Mehta

A chemical engineer by qualification, Pranali Mehta dutifully walked down the slated path and worked in a chemical firm for a year. Her passion for writing however, pushed her into experimenting with the same as a career. With over three years of experience in content writ Read more...