Xbox Game Pass made $230 million revenue in one month, most users pay for full subscriptions

Microsoft reveals a rare look at concrete Xbox Game Pass earnings, with the subscription breaking $230 million in subscriber revenues in a month's time.

[Obscure_Observer]

But Jim Ryan said Gamepass is not sustainable.

[jesujohn]

This is revenue not profit. There is a cost of running the service.

[dumahim]

I get the feeling this isn't the first time this has been explained to him in articles about MS revenues, but it never sinks in.

[VenomUK]

FFS! Why on Earth is there illiterate, innumerate people crowing about $230 million revenue? Without any other figures to give it context such as licensing fees, server running costs and advertising, it’s not possible to know if this is fabulously successful or a loss-making venture. What we can definitely assume is that $230 million is not NET profit!

ALSO, whilst so much internal Microsoft info was leaked the fact that the net profit wasn’t revealed alongside this number is because Microsoft likely didn’t share it with the court! Why do you think that is?

[darthv72]

Please note this is for "one month". Generally speaking, the contractual negotiations for game pass titles are for a period of time, not a month to month basis. So if a game pub is paid $10m to put their game on GP for 1 year... MS has made that $$ back in one month with 11 more to go before the title is removed. now obviously there are multitude of games that comprise the game pass catalog and all of which take a cut but this is still impressive for just one month.

Only the publishers know if their deal is worth it or not and so far many have said it has been worth it.

[fr0sty]

If it was doing so great, they'd be screaming their profits from the rooftops, instead we get Phil saying they're considering exiting gaming completely if things don't turn around dramatically for GP by 2027 (in other words, this may be their last generation in gaming, and GamePass is their last hope, and so far it hasn't delivered).

[Jin_Sakai]

What the cost to payout developers a month and run the service? This is only half the picture.

[blacktiger]

half? YOU MEAN LESS THAN HALF! The contract, the debt based system and so on

[RpgSama]

Cost to run the service, cost to include games into the service, cost of day one games, publicity costs, paying salaries, bonuses, benefits to the God knows how many people they have right now based on all the developers and publishers they had and the ones they bought. Licensing fess for the engines they use on their games, any cost related to game development besides employees, do we add the money they put into buying all these developers and publishers in there?

[aconnellan]

Why is it we never see this with other companies? Sony releases number of consoles sold, or developers talk about copies sold, but we don’t hear “great but what’s the profit margin?”

Yes revenue isn’t profit, but why is that only an issue when it comes to Game Pass?

[TheKingKratos]

Your name never checks out

[Brazz]

Revenue is not profit!

[343_Guilty_Spark]

So did N4G

[jimbo676]

Xbox game pass has been profitable for years. You take all the revenue you make and now have the buget for the next month. Don't go over that budget and profit. Rinse and repeat.

[ocelot07]

This is why people look at you as a massive troll/blind fanboy. That's revenue not profit their is a massive difference.

[EvertonFC]

You literally have no clue, we've explained this revenue Vs profit argument to you numerous times. Do you have no ability to learn and remember ? You say the same shite everytime 😂🤣

[shinoff2183]

Jesusjohn, Thank you guy for pointing that out. It won't matter though.

[Gamerscore2077]

Well how much profit did they make last month? You realize revenue & profit is two different things right?

[randomvoice]

It isn't

https://www.reddit.com/r/Ga...

Growth on gamepass has plateaued. Revenue is not profit. They've blown Billions acquiring publishers. There is a reason they don't publish the profit numbers or sale numbers at the end of the day.

[jjb1981]

It is when 90% of the games are trash.

[fr0sty]

Phil Spencer also said so... "We may exit the gaming business if Game Pass subscribers off consoles don't increase a lot by fiscal year 2027"

[northpaws]

@Obscure_Observer

You thought you found an angle to attack but you completely missed the point. Aim better next time.

[gold_drake]

its not long term, as phil said in an interview ha.

[purple101]

Ahh so 23million divided by $15 per month = 15.3million subscribers.

They say they have 20-30 million.

So now we know they have as many not paying as those who are. Either through Microsoft rewards which they're stopping... or conversion stacked subs. Or maybe something else I'm not aware of.

[roadkillers]

Do you think they are including DLC and add-on purchases in the subscriber revenue because subscribers are still spending money?

[ChasterMies]

Even though it looks like most users are paying over $200 per year for Game Pass Ultimate, there a more than a few legacy accounts that paid much less upfront for many years of service to come. Microsoft’s accounting folks might spread that out over time, but realistically, those legacy accounts won’t contribute to monthly revenue until their current subscription term ends. So revenue isn’t a good indication of total subscriber numbers,

[dumahim]

Where are you getting your $15 figure from? There's so many variables in how people can pay, it seems there no way to guesstimate a figure to go off of.

[purple101]

Well that's an average just for sake of easy math. For example it's 12.99 a month in uk which is about equal to 15dollars.

I believe it's 18dollars in USA. But that's per month, you save if buying 12 or 24month.

So the 15 figure is literally for easy math and a nice middle sum to take a base from

[PunksOnN4G]

With all the numbers Leaking about how much they paying Each dev a MONTH and Yearly. its no wonder xbox division has yet to turn a profit and gamepass is far from being profitable at all. with the big leaks and the amount they paying game wont ever be profitable as it is now

[lelo2play]

*Facepalm*

[Sonic1881]

Revenue or profit 🤔

[PunksOnN4G]

Xbox does not report that info LOL. We know wh. But todays leak shows 230mil but they paying 20-90m for games they 100% aint making a thing

[Profchaos]

It's why they have been shoving it down or throats for years now they want it to be their future and allow it to take over the industry the reality is it won't

[PhillyDonJawn]

Lol even if you subtract that, that's still great profit.

[PunksOnN4G]

@phillyDOn wTF you mean even if we SUB they would still great profit LOL... They paying more then they're making thats not how it works xbox kid really dumb these days

[aconnellan]

Why does it matter? When’s the last time you saw any publisher or dev report on profit instead of revenue?

[PunksOnN4G]

Sony does it ever Q xbox is the on division they dont announce the profits for but we know xbox has not been profitable since the ABK and UK court fight.

[crazyCoconuts]

So twice as many GamePass subs as Gold subs? Is it likely that 22M out of 34M subscribers DON'T have online access? Or is MS counting ppl with Gold + Gamepass as a Gamepass subscriber, which is likely imo.
It's an important distinction because it impacts the revenue per subscriber calculations that the article is making

[RupeeHoarder]

Revenue means absolutely nothing without knowing how much is paid out to publishers / operating costs.

[PunksOnN4G]

With all the Leaks today they paying devs 20m up to 90 Mil Monthly and some yearly soo they paying alot for the titles and we also know gamepass makes no money FTC court case showed us this and the BIG leak today confirms it

[MetroidFREAK21]

But what's the profit margin?

[tbagmonster]

all you guys crying over numbers, just use the service for as cheap as possible until ms implodes and enjoy it for what it is.

[MrNinosan]

$230 million in 1 month, and most pay full subscription?
My math is decent, but the cheapest GamePass was $9,99 so if no one paid for Ultimate, that means 23 million subscribers!

We also got the leak with list of prices to have games on GamePass:
Star Wars Jedi Survivor - $300 million
Suicide Squad - $250 million
Mortal Kombat 1 - $250 million
GTAV - $12-15 million/month
etc

Numbers don't lie.
GamePass is doing $230 million in one of their best months (I assume) and some think that should cover the cost of both day 1 games, covering loss of sales, paying the salary to employees and all the other costs to make games.

Wake up Xbox fans!!!

[PhillyDonJawn]

They don't pay those prices to have those games for 1 month tho. It's likely a 1 year contract or longer and all those games don't get added in the same month. All those games you listed combine would cost less than 100 million for a month

[MrNinosan]

Of course those are not monthly cost, if so, I'd right /month as I did on GTAV.

This is a onetime cost for those games with 1 year permission on the service.

Out of the around 400 games on GamePass, I'll be nice and say half is First Party, but most of the other 200 games are paid in one way or another.

$230 million/month for GamePass is nowhere near profitable.

[PhillyDonJawn]

I simply disagree. With all things considered I think it's very profitable

[tbagmonster]

wake up to what. are you mental. who gives a crap about what they make, we pay 16 a month, get tons of games, of they fail they fail. until then we get new games and tons of other games for cheap and gamers hunt for cheaper gamepass codes making it even cheaper

[DOMination-]

Why are all these Sony fanboys so concerned about the profit for 2.5 trillion dollar company MS? :D

They make 20 BILLION a QUARTER in PROFIT. Most of which comes from services in Azure and Office - albeit corporate focused rather than consumer.

Microsoft doesn't know what it's doing with a lot of things. But one thing they do know about is services. It's wishful thinking if you reckon Game Pass is going to go away. Is it making lots of profit or any profit right now? Well honestly nobody here can say as we don't have the info but realistically - no, they're probably not. And yes, Xbox division will have to start making a profit at some point. But right now, MS are prepared to invest $70BN + to augment the service. They aren't doing that to give up in two years - no matter how much you want them to.

Lets just agree that some people who actually have the data and have proven records in delivering highly profitable services probably know a bit more than some random users from the N4G community!

[MrNinosan]

The fans, which is not only Sony fans, have their concerns because MS is trying to change gaming for the worse.
When Xbox fans always say and think GamePass is a lucrative and profitable business they are feeding MS with exactly what they want, false trust.

GamePass ain't profitable, which is getting more and more obvious, especially with the leaks we had last 48 hours.

Why does it matter for us fans you ask?

Well, we have seen the quality on Xbox games going from great to decent/bad. This is because developers is getting "lazy" or stressed by the board to finish their products. Therefore most games today are called "GamePass fillers".

If/when more and more players are saying NO to paying full price for games (which we already see on Xbox), the quality of our games will disappear. We won't get blockbusters like God of War, Last of Us, Spider-Man, Final Fantasy, Halo, Starfield, Forza etc... those games will either be gone completely or compromised to fit a lower budget.

Xbox is a small part of MS, and in the leaks we've also seen that MS will stop supporting the gaming side of GamePass subscribers don't raise by alot until 2027.

How is that good for gamers?

It doesn't take that much of a brain to see why people is interested if GamePass makes profit or not.

[DOMination-]

And after all that, it turns out that Game Pass is actually profitable afterall - and the division as a whole more so than PlayStation. Or do we only believe some leaks?

"Well, we have seen the quality on Xbox games going from great to decent/bad. This is because developers is getting "lazy" or stressed by the board to finish their products. Therefore most games today are called "GamePass fillers"."

This is absolute garbage. For the last decade MS has done practically nothing with first party games and even when they did release a rare game during the Xbone era, it was sub-par.. outside of Gears, Halo, Forza, I can only think of Crackdown 3.

Yet in the last few years, MS have released:
FH5 - critically acclaimed - FREE updates every month
MSFS - critically acclaimed - FREE world updates every month
Grounded - very well reviewed title released in Early Access with constant free updates
Pentiment - critically acclaimed
Hifi Rush - critically acclaimed
Starfield - a very solid and well reviewed WRPG and one of the biggest games of the year
Halo Infinie & Redfall - Okay, you can't win them all but my understanding is Halo is still updated regularly for FREE and MS have committed to continuing to improve both.. which I personally disagree with but fair enough on them

This perception that MS are churning out terrible games as Game Pass filler is just demonstrably wrong. And even the claim that everything is behind paywalls or MTX is just untrue. Sure, some of those games do have MTX, FH5 and MSFS also have large paid expansions (which they did before Game Pass) but the "live service" aspects/updates are free and there's no evidence this is changing.

In addition to this, we now know that MS Publishing have 10+ "second party" games in development and first party studios have at least 45 that we know of - many we know exactly what they are, some is guesswork through job listings etc. And of those, MS showed us quite a few at their last event. Nearly all of them were single player narrative driven games or WRPGs and absolutely none of them looked like Game Pass filler.

"If/when more and more players are saying NO to paying full price for games (which we already see on Xbox), the quality of our games will disappear. We won't get blockbusters like God of War, Last of Us, Spider-Man, Final Fantasy, Halo, Starfield, Forza etc... those games will either be gone completely or compromised to fit a lower budget."

And again, this is just simply not true. MS have some smaller games in development but much of what we know are big AAA games. One of which released just a few weeks ago.

The budgets for gaming isn't a Game Pass issue. It's because the way to harness the technology required is expensive. Everyone wants better graphics but striving for photorealism is much harder with todays tech than making I don't know.. lets say Wipeout 2097 as a random example back in its era. Unreal Engine 5 and the use of AI should finally end this trajectory with costs and development time starting to improve.

Ultimately, what this boils down to is simple. If Game Pass was a Sony thing, this place would have a very different opinion. There might be the odd user who wants to stick to physical but for the most part, it would be praised as some super pro-consumer service around these parts if it was Sony.

And to prove the point, Sony do have their own service. And before that, they started this whole thing off by buying Gaikai. And yet I've not seen any such criticisms over what is essentially the same thing (day 1 launches aside).

[Reaper22_]

That's a lot of money. Microsoft is raking in the dough with gamepass.

[MrNinosan]

But wasting more to "rake" it in.
They equals bad business, but you need to attend school to get basic math.

[ken2813]

That’s in revenue not gross income. Also 230 million divided by a $10 subscription is 23 mil Subcribers. Somebody lying somewhere. Also the way M$ raised the price of the Sub out of nowhere and dropped the $1 gamepass deal means they are not making as much as you would think.

[Destiny1080]

so why the outlandish, price increase

[PhillyDonJawn]

Holy sht! Nearly a quarter bill in 1 month. Thats amazing no matter how you slice it.

[InUrFoxHole]

In before everyone else with my genuine concern for MS amount of revenue vs. Profit.

[Firebird360]

You guys realize ms is in this for the long haul.
Gp even if after costs only currently breaks even, its still a succes. Theyre building their future for gaming on xbox. Gp will eventually be everywhere.
Theyll only continue to grow subscribers, thats inevitable by adding all the first party studios.
And gp is basically a never ending subscription, once you tried it, itll be hard to leave it. You'll justify the price each month.

[fsfsxii]

stop dickriding lmao

[Firebird360]

How so? By stating the blatantly obvious?

[gold_drake]

revenue is not profit.

they still have to pay devs for their games ha.

[tagzskie]

Phil Spencer: GAMEPASS is not profitable
Xboys: thats not true
Also Phil: Experience the True VR experience on xbox one x
Xboys: Yeah at last true VR experience not some demo VR

After 4 years later
Also xboys: We dont need VR.

made up your mind boys are you going to believe in phil or not?