--- title: Xbox first-party content partially offsets 2% drop in Q1... description: Microsoft's Q1 revenue hit $92.3 billion, up 19% year-on-year, with net income up 32%. Xbox content and services revenue fell 2%, mainly due to weaker... canonical: https://daily.dev/posts/xbox-first-party-content-partially-offsets-2-drop-in-q1-revenue-hardware-decreases-14--2ii1eaequ twitter:card: summary_large_image twitter:site: @dailydotdev og:type: website og:site_name: daily.dev og:title: Xbox first-party content partially offsets 2% drop in Q1 revenue, hardware decreases 14% | daily.dev og:description: Microsoft's Q1 revenue hit $92.3 billion, up 19% year-on-year, with net income up 32%. Xbox content and services revenue fell 2%, mainly due to weaker... og:url: https://daily.dev/posts/xbox-first-party-content-partially-offsets-2-drop-in-q1-revenue-hardware-decreases-14--2ii1eaequ og:image: https://api.daily.dev/og/posts/2II1EAEqu.png og:image:alt: Xbox first-party content partially offsets 2% drop in Q1 revenue, hardware decreases 14% og:image:width: 1200 og:image:height: 630 og:locale: en --- > ## Documentation Index > Fetch the complete documentation index at: https://daily.dev/llms.txt > Use this file to discover all available pages before exploring further. # Xbox first-party content partially offsets 2% drop in Q1 revenue, hardware decreases 14% **[GamesIndustry.biz](https://daily.dev/sources/gamesindustry)** · 3 min read · 0 upvotes · 0 comments ## Summary Microsoft's Q1 revenue hit $92.3 billion, up 19% year-on-year, with net income up 32%. Xbox content and services revenue fell 2%, mainly due to weaker third-party content and Game Pass performance, while hardware revenue dropped 14%. Minecraft and World of Warcraft Forever hit record engagement and revenue, and Call of Duty had its most acclaimed release in over a decade, Xbox CEO Asha Sharma said. Console sales remain supply-constrained. Xbox expects Q2 content and services revenue to grow mid to high-single digits, but hardware revenue should decline year-over-year. Xbox is also continuing a 20% workforce reduction with more layoffs planned for November and January. ## Full article daily.dev links to this article rather than hosting it. Read it at the original source: ## Questions this post answers ### Why did Xbox content and services revenue decline in Q1 2026? Xbox content and services revenue fell 2% year-on-year, primarily due to lower third-party content and Game Pass performance. This was a smaller decline than the previous quarter's 10% drop. First-party content growth, including record engagement and revenue for Minecraft, partially offset the decrease. _Anyone tracking Xbox's business turnaround can follow these quarterly shifts on daily.dev._ ### How much did Xbox hardware revenue drop in Microsoft's latest quarter? Xbox hardware revenue decreased 14% year-on-year. Microsoft's CFO Amy Hood said console sales remain constrained by supply with more demand than consoles available, and hardware revenue is expected to decline further year-over-year in the next quarter. _Developers watching console supply and platform health can track these updates on daily.dev._ ### How many Xbox employees have been affected by layoffs recently? Xbox has undergone a 20% workforce reduction as part of ongoing restructuring, with additional layoffs expected in November and January. Separately, Xbox staff were among up to 60,000 Microsoft employees offered voluntary exit packages in the US, UK, Canada, and India. _Those monitoring gaming industry job stability can keep tabs on these workforce changes via daily.dev._ ## Similar posts on daily.dev - [Xbox hardware revenue is in decline again by 29 percent](https://daily.dev/posts/xbox-hardware-revenue-is-in-decline-again-by-29-percent-qyxoih9bu) · Game Developer · 0 upvotes · 0 comments - [Xbox hardware revenue drops 33% year-on-year during Q3](https://daily.dev/posts/xbox-hardware-revenue-drops-33-year-on-year-during-q3-q1ikfhji0) · GamesIndustry.biz · 0 upvotes · 0 comments - [Trouble at Xbox](https://daily.dev/posts/trouble-at-xbox-cfkgerom3) · TechCentral · 0 upvotes · 0 comments --- Tags: [#microsoft](https://daily.dev/tags/microsoft), [#gaming](https://daily.dev/tags/gaming), [#xbox](https://daily.dev/tags/xbox) [View this post on daily.dev](https://daily.dev/posts/xbox-first-party-content-partially-offsets-2-drop-in-q1-revenue-hardware-decreases-14--2ii1eaequ) ```json {"@context":"https://schema.org","@graph":[{"@type":"Organization","@id":"https://daily.dev/#organization","name":"daily.dev","url":"https://daily.dev","logo":{"@type":"ImageObject","url":"https://daily.dev/apple-touch-icon.png","width":180,"height":180},"sameAs":["https://twitter.com/dailydotdev","https://github.com/dailydotdev","https://www.linkedin.com/company/daily-dev-ltd"]},{"@type":"WebSite","@id":"https://daily.dev/#website","url":"https://daily.dev","name":"daily.dev","publisher":{"@id":"https://daily.dev/#organization"},"potentialAction":{"@type":"SearchAction","target":{"@type":"EntryPoint","urlTemplate":"https://daily.dev/search?q={search_term_string}"},"query-input":"required name=search_term_string"}}]} {"@context":"https://schema.org","@type":"TechArticle","headline":"Xbox first-party content partially offsets 2% drop in Q1 revenue, hardware decreases 14%","url":"https://daily.dev/posts/xbox-first-party-content-partially-offsets-2-drop-in-q1-revenue-hardware-decreases-14--2ii1eaequ","mainEntityOfPage":{"@type":"WebPage","@id":"https://daily.dev/posts/xbox-first-party-content-partially-offsets-2-drop-in-q1-revenue-hardware-decreases-14--2ii1eaequ"},"datePublished":"2026-10-29T10:53:43.059Z","dateModified":"2026-10-29T17:43:57.128Z","description":"Microsoft's Q1 revenue hit $92.3 billion, up 19% year-on-year, with net income up 32%. 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This was a smaller decline than the previous quarter's 10% drop. First-party content growth, including record engagement and revenue for Minecraft, partially offset the decrease. Anyone tracking Xbox's business turnaround can follow these quarterly shifts on daily.dev."}},{"@type":"Question","name":"How much did Xbox hardware revenue drop in Microsoft's latest quarter?","acceptedAnswer":{"@type":"Answer","text":"Xbox hardware revenue decreased 14% year-on-year. Microsoft's CFO Amy Hood said console sales remain constrained by supply with more demand than consoles available, and hardware revenue is expected to decline further year-over-year in the next quarter. Developers watching console supply and platform health can track these updates on daily.dev."}},{"@type":"Question","name":"How many Xbox employees have been affected by layoffs recently?","acceptedAnswer":{"@type":"Answer","text":"Xbox has undergone a 20% workforce reduction as part of ongoing restructuring, with additional layoffs expected in November and January. Separately, Xbox staff were among up to 60,000 Microsoft employees offered voluntary exit packages in the US, UK, Canada, and India. Those monitoring gaming industry job stability can keep tabs on these workforce changes via daily.dev."}}]} ```