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Xbox FY21 Q3 revenue up 50% as Xbox Series X|S and Game Pass boom

Xbox Series X Hero
Xbox Series X Hero (Image credit: Matt Brown | Windows Central)

What you need to know

  • Microsoft has detailed its FY21 Q3 earnings, reporting $41.7 billion company-wide revenue, with gaming revenue for the quarter up 50% year-over-year.
  • Xbox hardware revenue also increased 232% thanks to Xbox Series X and Xbox Series S, while content and services revenue boomed 34% throughout the quarter.

Microsoft announced its third-quarter earnings for its 2021 fiscal year on Tuesday, reporting a 19% increase in revenue year-over-year, clocking in at $41.7 billion. The company also demonstrated steady growth for its gaming portfolio this quarter, with revenue up 50% over the same period in 2020, attributed to a steady uptick across the complete Xbox portfolio.

The latest Q3 FY21 results come almost six months following Xbox Series X and Xbox Series S; its two latest hardware launches kickstarting a new console cycle. High demand for the latest devices, still regularly out of stock among retailers worldwide, pushed hardware revenue up 232%. Xbox Series X and Xbox Series S availability remains constrained by ongoing chip shortages, further amplified by interest in the new console family.

Microsoft FY21 Q3 Gaming Revenue

Source: Microsoft (Image credit: Source: Microsoft)

Xbox content and services also saw a 34% increase this quarter, attributed to success from both Microsoft-published first-party titles and third-party releases. Microsoft also reports Xbox Game Pass subscriptions, its Netflix-style subscription service for Xbox, PC, and cloud gaming, among services driving increased revenue. While Microsoft is yet to report new member numbers for Xbox Game Pass, it previously announced 18 million active subscribers in January 2021.

The latest earnings following a solid year for Microsoft's gaming lineup, with current world events and stay-at-home orders seeing gaming demand skyrocket. That contrasts this time last year during the onset of the COVID-19 pandemic, where gaming revenue fell 1% year over year, while content and services grew just 2%. It came as Xbox services saw "record numbers," pushing the company to disable Xbox Live features to streamline its moderation processes.

Matt Brown is Windows Central's Senior Games Editor, Xbox & PC, at Future. Following over seven years of professional consumer technology and gaming coverage, he’s focused on the world of Microsoft's gaming efforts. You can follow him on Twitter @mattjbrown.

9 Comments
  • Microsoft is in beast mode. Firing on all cylinders. They just need to work on getting more xbox series consoles and accessories on shelves.
  • With Chips being in such short supply. The real big question is can they keep up with demand.
  • I am Long MSFT 😁😁😁
  • Microsoft not mentioning the number of current Game Pass subscribers is odd.
  • They may be sitting on those numbers for the next big XBOX dog and pony show.
    The rumors say 23M at last count so by E3 they might have a round number, 30/40M.
  • Hope so. I've noticed more Game Pass ads the past couple of weeks so I would expect a decent growth from the official 18million + susbcriber count previously stated in January.
  • Xbox Content and Services grew 34%. Although it would of been nice to see the numbers broken down between the 3 areas within Content and Services, It's getting harder and harder to deny that GamePass isn't part of that success.
  • not countin all the revenue left on the table from all the people who would be buying them if they were available in the stores
  • Please take my money, Microsoft! 😉