Is Game Pass Profitable 2024?

One of the most discussed questions in the gaming community is: Is Game Pass profitable?

Game Pass has become a sensation, primarily because of the wide variety of games it offers, that too for an affordable price. However, the question of Game Pass’ profitability lingers because of the constant decline and losses that are occurring in the gaming industry in general.

So, has Game Pass passed the test of relevance, or is it a loss-making sector, too? Keep on reading to find out!

Is Game Pass Profitable

What is Xbox Game Pass?

Xbox Game Pass is Microsoft’s subscription-based gaming service that was launched in 2017. Game Pass offers an extensive library of games, including games from the Xbox 360, Xbox, and Xbox One eras, among others.

There is no limit to the number of games that the player can download or play, and the library keeps updating every month.

Also, once downloaded, the user can play games without an internet connection for upto 30 days.

Xbox Game Pass is currently one of the most extensive and affordable gaming services in the market, which is making it quite popular among game fanatics.


How Many Subscribers Does Game Pass Have?

How Many Subscribers Does Game Pass Have

Xbox Game Pass currently has over 25 million subscribers. Considering that the service was launched by Microsoft in 2017, which is not that long ago, it is quite an impressive number.

Microsoft revealed that they have seen a 159% year-over-year increase in subscribers, up from 10 million subscribers in the previous year.

What’s interesting is that Game Pass’ subscriber count is expected to increase even more in the coming years thanks to its extensive selection of games and affordable price.


Is Game Pass Profitable?

Since most gaming consoles and gaming companies, including Epic Games, have been making losses for quite some time now, people in the gaming world want to find out if Game Pass is profitable.

Luckily, Phil Spencer, the CEO of Microsoft Gaming, revealed that Game Pass is indeed profitable and makes for about 15% of Microsoft’s gaming and service revenue.

Phil said, “Game Pass as an overall part of our content and services revenue is probably 15 percent,” says Spencer. “I don’t think it gets bigger than that. I think the overall revenue grows so 15 percent of a bigger number, but we don’t have this future where I think 50–70 percent of our revenue comes from subscriptions.”

“What we see in Game Pass is a service that supports all kinds of games, from the biggest games, to the unknown indie games that you didn’t know you would love until you played it. If you’re an individual publisher, you really have to think about ‘how do you get everybody playing my game.’ he added.


How Much Money is Xbox Game Pass Making?

How Much Money is Xbox Game Pass Making

Xbox Game Pass has been seeing a continuous increase in revenue for a few years now. In 2021, Game Pass made $2.9 billion in revenue, and in 2022, it generated $231.5 million in revenue.

Microsoft also recently released its financial report for the quarter of the fiscal year 2024, which ended on September 30, 2023.

As per the report, Xbox gaming revenue increased by 9% or $309 million year-over-year because of “growth in Xbox content and services.”

Additionally, Xbox content & services revenue increased by 13% largely because of massive growth in first-party content and Xbox Game Pass.

The data clearly shows that Xbox Game Pass is a big success for Microsoft.


How Much is Xbox Spending on Game Pass?

In an interview, Phil Spencer disclosed that Xbox is spending more than $1 billion annually to add more third-party games on the platform.

This is because the company wants to focus on growing Xbox Game Pass, as it is contributing to the company’s profit generously.

Game Pass’s current strategy involves offering a diverse range of games right, from lesser-known indie games to blockbuster titles. This is why the company’s $1 billion investment in procuring games from third parties is essential.

The large variety of games play a key role in attracting a large audience, thus allowing the company to make more money.


Xbox Game Pass Subscription Cost

Depending on what you are looking for, the Xbox Game Pass subscription price can vary.

However, a standard Xbox Game Pass subscription will cost you $9.99 a month, which will give you access to 300 games that you can play on Xbox Series X or Xbox One.

Its PC Game Pass also costs $9.99 a month, but it gives you access to the EA Play vault of games.

Its third and best value-for-money subscription is Xbox Game Pass Ultimate, which costs $14.99 a month. This plan gives you access to Game Pass for console and PC, as well as EA Play. It also includes an Xbox Game Pass Core subscription that lets you play games from the cloud. 


Wrap Up

In conclusion, we can clearly see that Xbox Game Pass is a major success for Microsoft, both individually and in general.

In spite of a massive investment in Game Pass, it contributes to around 15% in revenue, which is quite impressive.

The company’s current gaming model for Game Pass includes updating new games every now and then, which is probably the reason why players are hooked to the service.

Hopefully, it will keep performing the same in the near future.


FAQ’s

Does Microsoft profit from Xbox Game Pass?

Yes, indeed, it does. Currently, Microsoft is raking in about 15% of its gaming and services. Additionally, it expects the revenue of Xbox content and services to be up by 50% in fiscal Q2, 2024.

How many games are there on Xbox Game Pass?

There are more than 400 games on Xbox Game Pass. The variety of games this console offers is exhaustive. It includes the best Xbox 360 games, Xbox series X games, and Halo Infinite. You can find many first-party and third-party games. Third-party games keep on updating, while first-party games that are published by Microsoft remain there. 

Is Microsoft gaming profitable now?

Yes, Microsoft gaming is profitable. Overall, Microsoft’s gaming revenue is, in fact, up by 49% in the first quarter of 2024.

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