Microsoft’s Chief Financial Officer, Amy Hood, has instructed the Xbox team to identify alternative ways to increase profitability.
Microsoft recorded substantial losses last year, largely tied to adding the Call of Duty franchise to the Game Pass subscription. A former employee who asked to remain anonymous said that moving away from traditional retail sales resulted in more than $300 million in lost revenue on consoles and PC, according to Bloomberg.
Faced with those financial pressures, CFO Amy Hood reportedly directed Xbox leadership to explore different methods to bolster earnings, sources among current and former employees told the publication.
Analysts argue the approach primarily benefited players rather than the company: direct sales revenue declined sharply.
Game Pass failed to deliver the explosive growth expected after the Activision acquisition, and Microsoft found that infrastructure costs were not aligned with their pricing model.
Former Xbox employees familiar with internal operations confirm that adding Call of Duty to Game Pass made the title available to millions of subscribers, but it also sharply reduced unit sales. Still, the franchise’s latest entry—Call of Duty: Black Ops 6—was the best-selling game in the United States in 2024 and the highest-selling release in the series’ history. IGN reports that PlayStation accounted for the bulk of those sales, representing 82% of the total.
Source: iXBT.games