Questions surrounding the profitability of Xbox Game Pass have existed for as long as Microsoft's gaming subscription service has been on the market. Ever since the launch of June 1, 2017, and increasingly more so over the years as Microsoft improved the subscription's value through various acquisitions such as Bethesda and Activision Blizzard, the widespread consensus was that it was 'too good to be true': an amazing deal for gamers, sure, but how long would even Microsoft, one of the most valuable companies on the planet, be able to sustain it?
Xbox executives such as Phil Spencer have repeatedly assured fans of the profitability of Xbox Game Pass, and now Xbox president Sarah Bond has done the same once again in a TGS 2025 interview with Japanese website Game Watch:
Last fiscal year, Xbox Game Pass sales reached a record high of $5 billion. It's a profitable business, and as more creators join Xbox Game Pass, payments to creators increase, so we think it's a good business for creators.
However, in light of yesterday's shocking news that the subscription service would now cost $29.99 on its Ultimate tier (with hikes for the other tiers, too), fans have criticized Bond's statement. If it was already profitable and a good business for everyone, why did it have to be subjected to such a massive (+50%) price increase?
Granted, Bond conducted the interview a few days before this announcement, but as president of Xbox, it stands to reason she was absolutely aware of the incoming news. Taking her statement as accurate, the only plausible explanation is that it was not nearly as profitable as Microsoft would want, especially as it starts demanding more from the Xbox division after spending $75.4 billion on Activision Blizzard and $7.5 billion on ZeniMax Media/Bethesda Softworks to bolster the Xbox Game Pass lineup.
Even with all those big games on the subscription services, like Elder Scrolls, Fallout, DOOM, Diablo, and Call of Duty, the subscription service hasn't grown as much as Microsoft wanted (or like some analysts, such as Michael Pachter, had estimated). If it can't have more subscribers, Microsoft seems to have decided it will now get more money out of those existing subscribers - only, it remains to be seen how many will remain at $29.99 monthly. Shortly after the announcement, too many requests overwhelmed the web page where Xbox Game Pass subscriptions are canceled.
About the author: With over two decades of experience in gaming journalism, Alessio Palumbo has led the gaming vertical at Wccftech since August 2015. He started working at a young age for Italian websites like Everyeye.it, Gamestar.it, Nextgame.it, and Multiplayer.it before kickstarting the indie English-language publication Worlds Factory as its founder and Editor in Chief. In the last decade, he has coordinated the overall output of Wccftech's gaming section, managed PR relations, assigned reviews, produced daily news coverage, edited gaming content as needed, and delivered game reviews. Arguably, his trademark content is the long series of exclusive developer interviews that have been cited by Wikipedia and by the biggest news media and gaming publications. His passion for technology also makes him knowledgeable when it comes to gaming hardware and tech. His favorite genres include RPGs, MMORPGs, and action/adventure games.
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