Microsoft has announced its quarterly earnings for the second quarter of 2025, indicating notable growth in its gaming division despite a decline in Xbox console sales. The company’s gaming revenue reached $5.5 billion from April 1 to June 30, reflecting a 10% increase compared to $5 billion during the same period in 2024.
Specifically, Microsoft’s sales in content and services rose by 13%. However, hardware sales, which encompass Xbox console sales, experienced a significant 22% drop in revenue. This drop stands in contrast to the previous quarter, where console sales only fell by 6%. Noteworthy Xbox game releases during this quarter included “South of Midnight,” “Clair Obscur: Expedition 33,” “The Elder Scrolls IV: Oblivion Remastered,” and several major updates for ongoing franchises like “Minecraft,” “Call of Duty,” “Diablo,” and “Halo.”
Overall, Microsoft reported an earnings per share (EPS) of $3.65 and total revenues of $76.4 billion, surpassing Wall Street expectations, which had forecasted an EPS of $3.38 on $73.8 billion in revenue. CEO Satya Nadella highlighted the company’s robust performance in the gaming sector, noting that Microsoft now has 500 million monthly active users across platforms. The success of popular titles like “Forza Horizon 5” and “Black Ops 6,” along with the rising popularity of the “Minecraft” franchise—boosted by a new movie—demonstrates Microsoft’s expanding influence in the gaming market. Game Pass revenue also hit an annual total of nearly $5 billion for the first time, contributing to positive long-term momentum.
Despite the setbacks in hardware sales, Microsoft’s overall growth in gaming and its active player base indicate a strong potential for future developments and innovations in the gaming industry.