Microsoft’s latest earnings report reveals a 33% decline in Xbox hardware revenue, while the company rakes in $82.9 billion overall. The company is retooling under Asha Sharma, who has slashed prices for Xbox Game Pass and is focusing on rebuilding Xbox's identity.
Executive churn continues at Microsoft with Phil Spencer’s retirement and Sarah Bond’s departure. Satya Nadella emphasizes the need to win back fans across its brands, including Xbox.
In a shift towards AI dominance, cloud business revenue hit $54.5 billion, up 29% year over year. Nadella notes that Microsoft’s AI business now generates an annual revenue run rate of $37 billion, a 123% increase from the previous year.
Despite this push, challenges persist, with Windows OEM and devices revenue declining by 2%, partly due to global memory shortages. New Surface models are expected to help address these issues in the future.
