Microsoft reports 13% fall in gaming revenue for December quarter

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Less than a week after announcing that 10,000 employees would be laid off, Microsoft has released its earnings report for the quarter ending December 31. The tech giant reported a decline in income, along with a 13% fall in gaming revenue.

The company revealed that X-Box reached a record in terms of monthly active users (MAU), clocking 120 million. On the other hand, it stated that it recorded a 12% drop in revenue from its game pass service.

X-Box game pass is a monthly online subscription that allows users to play a variety of games without paying for them. It is one of the main sources of revenue for Xbox services.

“In gaming, we continue to pursue our ambition to give players more choice to play great games wherever, whenever, and however they want. We saw new highs for Game Pass subscriptions, game streaming hours, and monthly active devices, and monthly active users surpass a record 120 million during the quarter,” said Satya Nadella, CEO of Microsoft, as quoted by India Today Gaming.

The company is also planning to acquire Activision Blizzard in a deal worth $68.7 billion in order to give their game pass service a boost. It plans to add popular game franchises like Call of Duty and Overwatch to game pass.

Currently, the Federal Trade Commission (FTC) has filed a lawsuit against the company with regard to the Activision Blizzard deal due to antitrust concerns, claiming that the deal will disrupt the gaming market and create a monopoly for the company.

While Microsoft claims that the deal will make the games accessible to all players through Xbox game pass and it will not make the games exclusive, rivals like Sony and Google are opposing the deal.

Microsoft and Activision are aiming to complete the deal by June this year, but with the FTC releasing a scheduling order that drags out the hearing to August 2023, there is uncertainty looming for the companies.