Microsoft’s Q1 ’24 Earnings Break Xbox Records, Reveal Growth

microsoft growth

In a recent financial update published by Microsoft, positivity was revealed to be a relatively consistent trend across the board – except for a few outlying areas. In the FY24 Q1 financial update, it was revealed that revenue was up quarter-over-quarter by 13%, sitting at around $56.5 billion – that growth was mirrored in many important areas for the corporation.

For instance, ‘Xbox content and services’ revenue also increased by 13%, despite Microsoft witnessing a drop in hardware revenue by around 7%. This financial report comes following the Activision acquisition, but it’s thought that this transaction hasn’t had an impact on this round of updates — but Starfield has.

The Most Important Game in Xbox History

For many, Starfield was – and continues to be – a game-changer for Xbox. It has recorded around 11 million players since it went live at the start of September, and it continues to dominate social circles and news feeds the world over.

If Microsoft is having issues with Xbox hardware sales, it’s more than making up for it with the growth in software revenue and the skyrocketing number of Game Pass subscriptions.

Going forward, we can expect something of a slowdown in hardware sales as consumers prepare for the next wave of Xbox consoles – the ‘mid-generation refresh’ that was leaked just a few weeks ago. It was revealed that there are new Xbox Series X|S consoles on the horizon that will surely compete with the newly-revealed PlayStation 5 ‘Slim’ unit.

For Microsoft, the growth detailed in the recent financial update is nothing but a good thing and the positivity offsets some of the dips in the log:

  • Net Income up 26%
  • Cloud Services up 22%
  • Server Products up 21%
  • Microsoft 365 Consumer Subscribers up to 76.7 million users
  • LinkedIn revenue increased 8% (layoffs drive more users to purchase LinkedIn Premium subscriptions to help with job searches)
  • $9.1 billion returned to shareholders

Amy Hood, the CFO of Microsoft, said:

Consistent execution by our sales teams and partners drove a strong start to the fiscal year with Microsoft Cloud revenue of $31.8 billion, up 24% (up 23% in constant currency) year-over-year,.

So, big money for Microsoft and a strong start to 2024 – the FY24 Q1 revenue split revealed that Xbox Gaming earned more in the first quarter of this financial year than any year on record. Let’s see if that growth continues as the Activision acquisition starts to pay off.

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