In its latest earnings report for the second quarter of fiscal year 2026, Microsoft revealed a revenue decline in its Xbox gaming division. The gaming segment fell by nine percent, while Xbox Game Pass revenue declined by five percent. By comparison, hardware revenue dropped by 32 percent, likely due to higher prices and weakening console sales. Overall, Microsoft reported a three percent decline in revenue. Back in October of 2025, Microsoft Gaming announced the new Xbox Game Pass upgraded tiers. These include Essential, Premium, and Ultimate. The Essential tier will replace the Core tier while the Premium tier has replaced the Standard tier. The Ultimate tier is the only plan that saw a price increase.
In May of the same year, Microsoft announced the price increase of Xbox Series consoles and controllers worldwide. This was reportedly due to “market conditions and the rising cost of development.” The Xbox Series X console prices increased by $100, and specific first-party Xbox games increased to $79.99.
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