Microsoft appears unfazed by the recent controversy surrounding the Game Pass price increase. In fact, the tech giant is forecasting a rise in subscriptions while anticipating a reduction in losses within Xbox’s services division in the upcoming quarter.
During their latest earnings call for the first fiscal quarter of 2026 (covering July to September), Microsoft executives shared that Xbox’s content and services revenue, which encompasses Game Pass, remains stable with indications of growth. It’s important to note that this period does not include revenue from the Game Pass price hike, which started in most regions in October and is scheduled for a wider rollout in November. The impact of these changes will be evaluated in the next earnings call set for late January 2026.
Interestingly, an executive mentioned that although they expect losses in services and subscriptions, they are still projecting an increase in Game Pass subscriptions. This indicates strong confidence in their offerings moving forward.
“In Xbox content and services, we expect revenue to decline in the low to mid-single digits against a prior year comparable that benefited from strong first-party performance, partially offset by growth in subscriptions,” the executive stated.
This statement raises an intriguing question: Are they anticipating a rise in subscriber counts, or just revenue? If the subscriber drop is less than the revenue increase from the price hike, that could still be considered a win. However, it certainly sounds like Xbox is banking on more gamers opting for Game Pass.
The confidence likely stems from a strong lineup of day-one releases, including titles like Outer Worlds 2 and Call of Duty: Black Ops 7. Xbox has made substantial investments in creating an engaging library, which Microsoft believes will not only retain existing subscribers but also draw in new ones.
Yet, this optimism contrasts sharply with the initial reactions following the announcement of price increases. Many gamers expressed skepticism about the future of Game Pass, feeling that such hikes would detract from accessibility. Paying $30 for the entire library seems less attractive when the original allure of Game Pass was getting access to a multitude of games for less than the price of an indie title. At $30, some players might prefer saving their money for full ownership of games priced between $60 to $70.
Ultimately, Microsoft’s strategy signals either a genuine belief that the enhanced offerings justify the increased price point or an attempt to reassure investors amidst community concerns.
What is the primary value of Game Pass now that prices have increased? The value lies in its extensive library, which includes both indie titles and blockbuster releases, still making it an attractive option for many gamers.
Will Game Pass subscriptions actually rise after the price hike? Microsoft believes that their lineup of day-one releases will attract more subscribers despite the price increase.
How does the Game Pass price increase affect accessibility for gamers? Many gamers worry that a higher price point may limit access, reducing the service’s initial appeal.
Are Xbox’s predictions about revenue growth realistic? Microsoft’s strong library offerings suggest that their optimistic expectations may well be justified.
In conclusion, whether you’re a long-time Xbox fan or new to Game Pass, it’s worth keeping an eye on how these developments unfold. As Microsoft navigates this patch, the gaming community is in for an interesting ride. For more insights and updates, check out Moyens I/O.