Xbox gaming revenues are being supercharged by Activision Blizzard King.
Microsoft just reported its Q3 FY24 results, and it's great news for Xbox. The games division generated $5.45 billion in the period from January - March 2024, up 50% year-over-year and driven almost entirely by software and services. Q3 earnings have been significantly elevated due to Microsoft recognizing Activision's revenues as part of its own--ABK made up 61 points of the 62% growth in content & services earnings.
Things get even more interesting when we tally up Xbox's 9-month results. Thanks to Activision's mighty multi-billion dollar influx, Xbox has now made more revenue in 3 quarters than it has for all previous full year periods. Xbox is currently at $16.481 billion for the Fiscal Year 2024 period, beating out the original $16.22 billion record set in Fiscal Year 2022.
Past performance indicates that Xbox could break $20 billion by FY24's end in June. This would be a new all-time historic high for Xbox gaming--which it currently is now, as of Q3'24--and would put Microsoft closer against Sony's strong $26 billion dominance over the console market's Big 3.
Microsoft completed its acquisition of Activision Blizzard King in 2023 and started integrating ABK revenues into its results at the start of Q2'24, which runs from October - December. ABK contributed more than $2 billion revenue for that period.
Thanks to Activision, Microsoft now owns and operates a multitude of best-selling billion-dollar franchises--the games division is now so big that there are more first-party Xbox games on PlayStation's 25 best-sellers list than there are Sony first-party games.
"And in Gaming, revenue increased 51% and 50% in constant currency, with 55 points of net impact from the Activision acquisition. Results were ahead of expectations primarily driven by Call of Duty," Microsoft stated in its webcast.