Microsoft's Gaming Business Falls Short, Despite Activision

gaming

In 2021, Microsoft CEO Satya Nadella faced a choice involving the company’s Xbox and cloud gaming business. The company could either acquire major game studios to drive more subscriptions to its nascent Game Pass subscription service. Or it could wind down its games business entirely, Nadella told two people at the time. Nadella took the first path, acquiring Elder Scrolls maker Bethesda Studios for $7 billion in 2021 and Call of Duty maker Activision Blizzard for $75.4 billion in the fall of 2023. So far, the returns on the investments appear unimpressive: In the year to June, Microsoft’s gaming business revenue grew 5.8%, well below the 11% target set for the purpose of calculating part of Nadella’s ...

The Information     Jan 14, 2025