Today Microsoft announced its financial results for Q1 of fiscal year 2025, related to the period between July and September 2024, including an update on its gaming business.
It’s worth mentioning that (as for the past three quarters), the results presented today include the numbers for Activision, Blizzard, and King as Microsoft completed the embattled acquisition of the publisher last year. From the next quarter, we should see much smaller percentages since the comparison will be apples to apples.
According to the financial documents of the More Personal Computing Business, which includes the gaming business, overall gaming revenue grew 43% year-on-year, including 43 points of net impact from the Activision acquisition. This means that without the acquisition, Gaming revenue would be essentially flat.
Xbox content and services revenue was up a whopping 61%, including 53 points of net impact from the acquisition, so there is some growth here independently from the acquisition.
On the other hand, hardware revenue dropped by 29% year-on-year due to the lower volume of consoles sold.
Below you can see a full breakdown of the impact of the acquisition on today’s results. Activision Blizzard brought in $1.69 billion in revenue. Yet, it incurred an operating loss of $440 million due to $960 million in cost of revenue summed to $1.17 billion in operating expenses.
The form 10-Q includes specific details on the financial performance of the gaming business. Revenue was $5,621 million, up from $3,919 million in the same quarter last year. If you subtract Activision, Blizzard, and King’s revenue, Microsoft’s gaming revenue for the quarter not counting the impact of the acquisition is $3,931 million, which is indeed essentially flat.
If we take a brief look at Microsoft as a whole corporation, revenue was $65.6 billion, up 16% year-on-year. Operating Income was $30.6 billion, up 14% year-on-year.
If you’re interested in comparing with historical data, you can check out our article about the previous quarter’s financial results, announced in July. Other companies have also already announced their financials this quarter, including Koei Tecmo, Capcom, Electronic Arts, and Ubisoft.
