Microsoft shared details on the company’s financial results for Q2 FY25 on Wednesday, revealing that gaming revenue was down 7% year-over-year for the quarter ending Dec. 31, 2025. The quarter did see Xbox content and services revenue up 2%, to which the company credits growth in Xbox Game Pass. Xbox hardware revenue declined 29% year-over-year.
This is the first quarter in a full year not to see a massive year-over-year leap on paper, and that’s because Microsoft’s acquisition of Activision Blizzard King (and the large leap in revenue it provided) is now fully normalized in the company’s results, with the last large leap being accounted for in Q1 FY25.
Overall, Microsoft saw $69.6 billion in revenue for the quarter, with operating income of $31.7 billion, up 17% year-over-year.
Xbox Game Pass growth is thanks to Call of Duty
We already know that Xbox Game Pass growth is thanks to the launch of Call of Duty: Black Ops 6, which (as an Xbox first-party game) was included day one with Xbox Game Pass Ultimate and PC Game Pass.
Sharing details on U.S. game sales, analytics firm Circana noted that subscription spending was up in October, November, and December 2024, with the gains driven primarily by Xbox Game Pass.
Developing…