Xbox reported a 10 percent decline in revenue from content and services, including its Game Pass subscription, according to Microsoft's fourth-quarter earnings report released on July 29, 2026. Additionally, Xbox hardware sales decreased by 13 percent. This announcement follows Xbox head Asha Sharma's recent announcement of a 'reset' plan, which includes significant layoffs and the spinoff of four game studios, such as Compulsion Games and Double Fine Productions. Sharma has also implemented changes to Xbox, including a reduction in Game Pass prices.
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Xbox Revenue Declines 10 Percent Amid Changes in Leadership and Strategy
Microsoft's Xbox division experienced a 10 percent drop in revenue from content and services and a 13 percent decline in hardware sales, as reported in the company's fourth-quarter earnings report. These changes come alongside a strategic 'reset' plan announced by Xbox head Asha Sharma, which includes layoffs and studio spinoffs.
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Xbox revenue drops 10 percent as Microsoft’s cloud and AI business surges
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Xbox Revenue Declines 10 Percent Amid Changes in Leadership and Strategy