Overview

• Informed sources confirm that Game Pass remains profitable under Microsoft’s accounting methods, which include third-party fees and service costs but exclude first-party development spending.
• A former Microsoft executive’s LinkedIn post shows Game Pass deal costs ranged from $50,000 to $50 million across more than 500 title agreements.
• U.S. video game subscription spending hit a record $0.6 billion in May 2025, driven by console subscriptions and MMO services.
• Circana analyst Mat Piscatella warns that the top 10 live service games, including Fortnite and Marvel Rivals, consume nearly half of all PlayStation and Xbox playtime.
• Microsoft’s fourth round of layoffs eliminated about 9,000 positions despite continued profit gains in its Xbox division.