Find out how to kick start your games industry career

Get Your Free Ticket Today

Xbox Live estimated annual earnings: $1.2 billion

DLC and movies now bring in more revenue than Gold subscriptions

Microsoft's Xbox Live online gaming service appears to be earning the company in excess of $1.2 billion.

While Forbes published similar statements last month, financial network Bloomberg has coaxed Dennis Durkin, Xbox’s chief operating officer, into reiterating that revenue from downloadable add-ons, movies and other content now exceed that of Xbox Live's paid subscriptions.

Based on earlier revelations that 56 per cent of the 25 million Live users paid $50 for Gold level access in 2009, Microsoft is likely to be earning in the region of $625 million from subscriptions alone.

If other Live revenue - also including avatar customisation and classic game re-releases - does indeed exceed that, total earnings from the service will be greater than $1.25 billion.

Microsoft will not report its 2010 fiscal results until later this month, but Goldman Sachs analyst Sarah Friar suggested to Bloomberg that the technology firm's operating income for the year ending June 30 will be $1.04 billion, six times greater than the previous year.

She also estimated that total Xbox Live sales for 2008 would have been around $800 million, and that the amount of Live revenue recouped after production costs is around 65 per cent.

With Xbox hardware notoriously taking several years to turn a profit, Live's burgeoning success may well be key to Microsoft's continued investment in gaming.

Find out how to kick start your games industry career

Get Your Free Ticket Today

More stories

Xbox Game Pass growth slows as Microsoft misses target

Subscription service only grew by 37% during fiscal year, compared to target of 48% and previous year of 86%

By James Batchelor

Phil Spencer says Xbox is not done acquiring game studios

Head of Microsoft's console business says there will be more additions, but there's no quota or timeline involved

By Jeffrey Rousseau

Latest comments (1)

David Rider Publisher, Hustler UK11 years ago
I bet there are veins standing out on Bobby Kotick's forehead right about now.
0Sign inorRegisterto rate and reply

Sign in to contribute

Need an account? Register now.