Overview
- Microsoft reported Xbox content and services revenue down 5% and hardware revenue down 32% year over year for the quarter ended December 31, 2025.
- Amy Hood said gaming results came in below expectations due to underperforming first‑party content with impact across the platform.
- Overall gaming revenue declined about 9%, marking the division’s first quarter‑over‑quarter drop in years.
- Microsoft guided that Xbox hardware revenue will decline again in Q3, with potential offsets from Game Pass, PC, and cloud engagement.
- Satya Nadella highlighted record PC players in paid streaming, while industry reports pointed to weaker‑than‑expected Call of Duty: Black Ops 7 sales as a contributing factor.