Microsoft’s Gaming Revenue Soars with Activision Blizzard Deal

Microsoft’s revenue in the Xbox Gaming sector has increased significantly as compared to the past couple of years. And, according to a recent report, this massive jump in revenue can be deceptive, as most of this spike is due to the acquisition of Activision | Blizzard and King by Microsoft.

For the third quarter of FY 2024, Microsoft reported that its gaming revenue has been on an uptrend of 51% year-over-year.

Microsoft officially acquired Activision | Blizzard on October 13th, 2023, which is almost two years after the deal was first announced in January 2022. Since then, starting in FY24 Q2, Microsoft’s financials have included the revenue from Activision Blizzard as part of Xbox.

This means that the baseline for the entire Xbox gaming division has risen. While Microsoft is still integrating Activision Blizzard (and King) into its first-party studios, the acquisition has begun to bear fruit for players, with games like Diablo 4 being added to the Game Pass.

The CEO of Microsoft, Satya Nadella, stated that Xbox Game Pass players have spent over 10 million hours in-game since it was added to the service. Microsoft Gaming CEO Phil Spencer also noted that they are expecting to port more of Blizzard’s games to the Game Pass in the future as well.

Looking ahead at FY24 Q4, Microsoft is expecting to grow to the mid-40s range year-on-year for its gaming revenue. And while its gaming revenue is up its hardware sales of Xbox and surface devices have been falling and are expected to go down even more.