Xbox is Operating Under A “Challenging Set of Revenue and Profit Goals”

It's no secret that Xbox has been struggling lately, even more so after the Activision acquisition, a deal that cost $69 billion to buy the company. This makes it the largest acquisition in gaming but not necessarily the smartest. It's been even more challenging for Xbox, as the overall gaming market has stagnated significantly, primarily due to events like the pandemic, which made the industry even more volatile than it already was. One of the significant factors in the industry now is how inaccessible games are to many people, with blockbuster games costing $70 to purchase as the average gamer. Sarah Bond, the Vice President of Xbox has said that they are now looking into other areas aside from the "traditional gaming business" and aiming to reach into "untapped areas." By discussing her next moves, she's hinted at new Xbox hardware, where Phil Spencer has continuously expressed interest in a handheld device.

Of course, while discussing new hardware, they are also peddling Xbox-exclusive games and promoting their subscriptions, such as the Xbox Game Pass, with a heavier focus now on the subscriptions instead of the consoles. While the Activision acquisition has much potential for Microsoft, Bond must continue to make more sacrifices in the game division. Over 2,650 jobs have been lost this year, adding to the total industry-wide job losses of 11,500.

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Despite Microsoft's belief that the Activision acquisition will benefit them in the long run, the gaming unit is operating under a challenging set of revenue and profit goals, as those who are familiar with Xbox's business capabilities state.

Bond is very aware of the challenge ahead of them, saying, "The opportunity on the other side is way bigger for all of us," an opportunity that the company has been fighting for almost a year. A few months after Bond started working at Microsoft, Game Pass was implemented, a