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[Bumblebeetuna]

If true, those are horrible numbers.

$2 billion in 3 years (or even $2 billion in 2 years) mean nothing when they confirmed spending $1 billion just getting third-party deals. Then there is 1st-party revenue to account for due to dip in game sales. And the xCloud and marketing costs on top of it.

Pretty much confirms that Game Pass is also in the red. No wonder they keep increasing the price while reducing the number of games that join the sub.

I know others have already corrected your gold journalism on the revenue, but there also hasn't been any noticeable drop off in quantity of games (not to mention the quality as of late has been even better than ever) but also, literally every sub service raises prices.

 

[havoc00]

All while being the best value in gaming!

 

[adamsapple]

If true, those are horrible numbers.

That's much better then.

 

[onQ123]

Never was 35 million. That the number after XLG was renamed Game Pass Core.

And I believe this is what they used to come to $2b

 

[Heisenberg007]

I know others have already corrected your gold journalism on the revenue, but there also hasn't been any noticeable drop off in quantity of games (not to mention the quality as of late has been even better than ever) but also, literally every sub service raises prices.

I love how much tag disturbs you every single day

 

[Bumblebeetuna]

I love how much tag disturbs you every single day

How much tag disturbs me? Huh?

Just making a joke, kiddo.

 

[Skifi28]

Further evidence to hammer the lies, fairytales, and fallacies on that disgusting now dead Xbox cult that what they thought was success is actually failure.

How do you know if it's a success or failure from just revenue?

 

[DeltaPolarBear]

And I believe this is what they used to come to $2b

And since Sony merged PlayStation Now into premium PS+, that makes them basically equivalent enough to compare. That's despite Sony basically treating PS+ as an afterthought these days.

As I said earlier in the thread, Sony PS+ revenue of 2024 was somewhere near 4.2 billion. All despite Sony sacrificing nothing for it. Xbox bet the farm on Gamepass and only get 2 billion a year?

Obviously it is better to get profit numbers. But Sony only name profits for the entire PlayStation department. And Xbox profitability is deliberately hidden.

How do you know if it's a success or failure from just revenue?

By the change in business strategy. The entire business hinges on a critical mass of subscribers that Xbox never reached, and can never realistically reach. It is the "best deal in gaming", a pity that most people are playing free games instead. And now it can't support itself.

At least with PS+, the data show 20% growth year over year. But with Gamepass they didn't tell us there was any real growth.And Gamepass needed growth to survive.

 

[mdkirby]

Edit: nvm just seen it said 2019-2021, which is fucking ancient and pretty irrelevant to determining its current state.

that sounded nowhere near enough revenue to be in the black, so i spent some time interrogating an ai and it also suggests that this would have them in the red (obviously not including the mass expenses of buying studios). A breakdown for any who are interested:

To estimate the total annual cost of running Xbox Game Pass for Microsoft, we need to combine the various expense categories we've explored: third-party content, first-party development contributions, marketing, and operational costs (servers, bandwidth, etc.). Since Microsoft doesn't provide an official total, this is a synthesis of available data, industry norms, and reasoned assumptions. Let's break it down and sum it up.

1. **Third-Party Content**: Phil Spencer confirmed in a 2023 Windows Central interview that Xbox spends "over a billion dollars a year" securing third-party games for Game Pass. This covers licensing deals, day-one releases, and publisher agreements. Let's peg this at a baseline of $1 billion annually, though it could flex higher with big titles like *Call of Duty*.

2. **First-Party Development (Game Pass Share)**: Xbox's total first-party development spend across its 23 studios was estimated at $1–2 billion annually, with $1.5 billion as a midpoint. Not all of this goes to Game Pass—some titles (e.g., *Forza Motorsport*) sell standalone—but Game Pass relies heavily on first-party exclusives to drive subscriptions. If half of this effort supports Game Pass (a conservative split given its strategic priority), that's $750 million yearly. This covers development of titles like *Starfield* or *Fable* that hit the service day one.

3. **Marketing**: Game Pass-specific marketing was estimated at $200–400 million annually, based on 10–20% of its imputed revenue ($1.6–2.4 billion, per Spencer's 2022 Verge comments) and industry norms. Microsoft's campaigns—TV ads, E3-style events, and cross-promotions with hardware—suggest a midpoint of $300 million feels reasonable, especially with high-profile launches.

4. **Operational Costs (Servers, Bandwidth, etc.)**: Running the service, including Azure servers and cloud streaming, was estimated at $300–600 million yearly, with $400–500 million as a likely range. This accounts for 25 million-plus subscribers downloading and streaming games, plus data center upkeep. We'll use $450 million as a midpoint, reflecting growth since 2022's subscriber count.

### Total Estimate
- Third-Party Content: $1 billion
- First-Party Development (Game Pass Share): $750 million
- Marketing: $300 million
- Operational Costs: $450 million
- **Total**: $2.5 billion per year

### Reality Check
This $2.5 billion figure aligns with Microsoft's gaming ambitions. Xbox's 2023 gaming revenue was $15.5 billion (per SEC filing), and Game Pass is a cornerstone, reportedly generating $1.6–2.4 billion annually. Spending $2.5 billion to sustain a service that size makes sense—subscription models often run at thin margins or losses early on to build market share. Posts on X sometimes speculate $3–4 billion total, but these often conflate one-time costs (e.g., Activision Blizzard's $69 billion acquisition) with recurring expenses. Our estimate excludes such capital expenditures, focusing on operational costs.

### Variables
- **Upside**: Big releases (e.g., *Call of Duty: Black Ops 6* in 2024) could push third-party or marketing costs higher, nudging the total toward $3 billion.
- **Downside**: Shared infrastructure with Xbox Live or efficiencies in Azure might trim ops costs, dropping it closer to $2 billion.

So, Game Pass likely costs Microsoft around $2.5 billion annually to run in totality, give or take a few hundred million depending on the year's release slate and subscriber growth. It's a hefty investment, but one that fuels Xbox's ecosystem play.

 

[sendit]

I know that PlayStation Plus is not 1-to-1 with Gamepass but Xbox did merge Xbox gold into Gamepass, so now they are almost equivalent.

According to this link, PlayStation Plus had revenue of 2.9 billion for 2022 and 3.5 billion for 2023.
And according to THIS link, PlayStation Plus 2024 made a 20% INCREASE in revenue from the year before. That would mean 4.2 billion.

So, Xbox sacrificed 1st day game sales and making customers refuse to buy games, and they got 2 billion dollar revenue a year on average.
All the while PlayStation barely offer much on P+, raised their prices , and STILL got more revenue year after year, AND even on average they made 3.5 billion revenue a year.

And i am pretty comfortable to guess that Sony spent less each year on PS+ than Xbox on Gamepass.

Good insight. Context is everything.

 

[Killjoy-NL]

"Used to"?

Does that mean revenue dropped?

 

[DeltaPolarBear]

"Used to"?

Does that mean revenue dropped?

Yeah, it is rather strange to name only up to the 2021 year. As my prior links showed that Sony is pretty public about PS+ Revenue up to the most recent financial year of 2024.

If it went up after 2021 Xbox would have included it.

Edit: I did some google diving. Apparently there was some optimistic prediction of Gamepass earning 5.5 million in revenue for 2025, but that was a prediction from September and I have found no actual confirmed data since. Also the source was an analyst and not from Xbox, so massive salt grains there.

Also, they said they increased subscribers by 30% in 2024. But most of us believe that is just filling numbers by turning Xbox Gold members into Gamepass subscribers.

 

[yazenov]

Alright but how much profit did they make if any?

 

[yazenov]

Further evidence to hammer the lies, fairytales, and fallacies on that disgusting now dead Xbox cult that what they thought was success is actually failure.

Further evidence you do not have a clue on what you're talking about and confusing revenue with profit.

This usual post is in every MS threads where MS never disclose their profit from their gaming sector.

 

[DeltaPolarBear]

Further evidence you do not have a clue on what you're talking about and confusing revenue with profit.

This usual post is in every MS threads where MS never disclose their profit from their gaming sector.

Microsoft USED to disclose their profit. Until they gave up. Pretending that they never did is either a lie or you were too young to remember it.

 

[adamsapple]

Edit: nvm just seen it said 2019-2021, which is fucking ancient and pretty irrelevant to determining its current state.

Yep, I reckon it's notably higher now with inclusions like Starfield, CoD's etc reportedly breaking new sign-up records.

 

[RoadHazard]

Who gives a shit about revenue? What's the loss or profit?

 

[wolffy66]

So basically nobody knows but we're just gonna argue about it anyways. Carry on then.

 

[FrankWza]

How do you know if it's a success or failure from just revenue?

You don't. You give out socks and start talking about engagement