Microsoft announced its financial results for Q4 of fiscal year 2026, related to the period between April and June, in addition to those for the full fiscal year. These include the results for the Xbox business.
Interestingly, we see that the gaming business has been renamed as Xbox on the financial side as well.
Speaking of Q4, we learn that Xbox Content and Services revenue declined by 10% year-on-year “on a prior year comparable” (which means that the company considers the drop due to the previous year being particularly strong more than the current year being particularly weak), which benefited from strong first-party performance.
Xbox hardware declined by 13% year-on-year.
Microsoft mentions impairment changes related to games, which certainly refer to the major and unfortunate restructuring going on at Xbox.
Looking at the whole year, Xbox made $21.790 billion in revenue, a 7% decline compared to the $23.455 billion made in fiscal year 2025. Xbox Content and Services dropped by 5% year-on-year.
The decline of Content and Services is again explained by a prior year comparable that benefited from strong first-party content performance, but it was partly offset by growth in Xbox Game Pass.
Xbox Hardware declined by 29% year-on-year, due to the lower volume of consoles sold.
Interestingly, the year-to-year comparison isn’t the whole story. While in fiscal year 2026, Xbox’s revenue declined from fiscal year 2025, it actually did better than fiscal year 2024, which saw revenue at $21.503.
Those who chase the dream of forever growth will only see the year-on-year drop, but if you look at the bigger picture, it explains all these “prior year comparable” mentions.
In terms of the whole company, yearly revenue was $331.839 billion, up 18% year-on-year. Operating income was $155.237 billion, up 21% year-on-year.
If you’re interested in comparing the results announced today with historical data, you can read our article dedicated to the previous quarter’s financial results, announced in April.
Other gaming companies have already announced their financial results this quarter, including Koei Tecmo and Capcom. You can expect plenty more reports on this topic in the coming days and weeks.
