This week kicks off financial reports from the biggest publishers and developers in the video game industry. Many companies such as Capcom have reported on their growth and success with their various IPs. There is plenty of data to sift through to see the overall health of the gaming industry. Late last night, Xbox revealed its year-end financial results, as Xbox closes another incredibly successful year thanks to growth in almost every aspect of its business. Time to break it down by the numbers a big thanks to Daniel Ahmad for his excellent break down of the numbers.
Software Leads The Way
2021 proved to be an incredibly successful year for Xbox in terms of its first party games. As Forza Horizon 5 exploded in growth reaching over 18 million players since its launch in November of last year. Halo Infinite also had incredible success as hit over 20 million players, making it one of the most played Halo’s games ever. Content and services on the Xbox platform were overall up 8.8% YOY which translates to $12.6 billion. This growth was driven by increased first party releases, the continued growth of Game Pass, and more digital copies sold. All of this managed to balance that overall 3rd party titles sales declined YOY. This was likely caused by the heavy amount of delays seen throughout 2021.
Content and services continues to be a massive piece of the success of Xbox. As around 77% of the company’s revenue was driven by its content and services. With the major focus on growing and expanding Game Pass, it only makes sense that Xbox will continue to strive and expand its first party offerings, as well as chasing 3rd party deals for the service. The more profitable they can make their content the better it is for the company in the long run.
Xbox Series X & S Continue to Thrive
Hardware has been a serious growth for Xbox over the year of 2021. This was of course driven by the high demand for both the Xbox Series X and S, as well as 2021 being the first full year these consoles were on the market. Due to this, hardware grew 63.3% YOY and totaled at $3.7 billion for the year of 2021. This number will likely continue to grow as hopefully in 2022 we will begin to see these consoles in stock around the world.
After a strong 2021 Xbox Series consoles reportedly total over 12M units sold, and represent the strongest launch Xbox has seen in terms of hardware ever. Xbox Game Pass continues to grow with over 25 million subscribers, which continues to grow exponentially thanks to strong 3rd and first party releases. With a strong 2022 ahead with big releases such as Starfield on the horizon, it will be interesting to see how Xbox will continue to grow over the coming year.