GAMESMachine Translated summary

Microsoft Xbox revenue declines 7% in fiscal year 2026 amid hardware struggles

Microsoft reported a 7% decline in Xbox revenue for fiscal year 2026, with hardware sales falling approximately 30% year-over-year. Xbox executives, including CEO Asha Sharma, have announced plans to pivot the division toward more profitable ventures and expect a recovery by summer 2027, though the unit continues to struggle despite growth in the broader gaming audience.

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What we know

  • Xbox revenue dropped $1.7 billion or 7% for the full fiscal year 2026
  • Hardware sales declined roughly 30% year-over-year, representing the largest drag on the division
  • Xbox executives acknowledge the business failed to grow in line with overall audience expansion
  • CEO Asha Sharma outlined a strategy targeting rapid growth and profitability in 2028 and 2029
  • The company expects a bounce-back by summer 2027 after recent layoffs and restructuring

Referenced titles

The Division