Story
Total Gaming Revenue: +51%(-4% w/o ABK)
Content and Services Revenue +62%(+1% w/o ABK)
Hardware Revenue -31%
“Microsoft just posted the third quarter of its 2024 fiscal financial results. The software maker made $61.9 billion in revenue and a net income of $21.9 billion during Q3. Revenue is up 17 percent, and net income has increased by 20 percent.
This is the second quarter in a row that Microsoft is including its additional revenue from its Activision Blizzard acquisition that briefly pushed gaming to be Microsoft’s third-largest business. This time around, gaming is back into fourth place behind Windows thanks to stronger than expected Windows OEM revenue this quarter.”
“Despite a strong quarter for Microsoft with Office revenue and Microsoft Cloud revenue up 23 percent year over year, Microsoft’s overall gaming revenues are only up thanks to Activision Blizzard, with Xbox hardware revenue tanking this quarter alongside devices (Surface) revenue also dropping once again.”
“Over on the Xbox and gaming side, Xbox content and services revenue, which includes Xbox Game Pass, is up by 62 percent. This is once again thanks to Activision Blizzard revenues making up the bulk of revenue.
This quarter, Xbox hardware is down by a massive 31 percent, a big drop following a soft quarter for Xbox sales during the all-important holiday season last year. Microsoft admits the obvious in its earnings filing: that the big drop was “driven by lower volume of consoles sold.”
Overall, gaming revenue is up 51 percent, bolstered by the additional Activision Blizzard revenue, which contributed 55 points of net impact. That means without Activision Blizzard, Microsoft’s overall gaming revenue would have actually declined this quarter. The newly acquired division recorded $1.97 billion in revenue during Q3, but the cost of integration, transaction costs, and other costs of revenue in total $980 million. With other operating expenses ($1.34 billion), it calculates to an overall operating loss of $350 million for Activision Blizzard.“
Hardware on a sharp decline. ABK saving the revenue numbers but actually totaling to an operating loss… Gaming back in 4th behind Windows… Let’s see the Lems spin this news…
Log in to comment