It’s the first time Microsoft has disclosed fresh Xbox Game Pass subscriber numbers since announcing its Activision Blizzard acquisition in January 2022.
Microsoft Gaming CEO Phil Spencer previously admitting he had been seeing growth slow on Xbox Game Pass for consoles. “We’re seeing incredible growth on PC … On console, I’ve seen growth slow down, mainly because at some point you’ve reached everybody on console that wants to subscribe,” said Spencer in a Wall Street Journal interview in October 2022.
It’s clear that Microsoft is a ways away from hitting its ambitious goal of 100 million Xbox Game Pass subscribers by 2030. Microsoft targeted a 73 percent growth rate for Game Pass subscriptions for a single fiscal year that ended in June 2022, but only managed 28 percent. The company then dropped Xbox Game Pass growth as a target for Satya Nadella’s executive compensation last year, after first exceeding its ambitious Game Pass internal targets in 2020 and then failing to meet compensation targets for two years in a row.
The 34 million figure is reflective of the fact Xbox Series S / X consoles haven’t been selling as well as PS5 hardware, and that consumers aren’t flocking to Game Pass for Xbox Cloud Gaming on mobile devices. Microsoft also started converting Xbox Live Gold subscribers over to Xbox Game Pass Core last year, and Microsoft has confirmed the 34 million includes those subscribers, too.
Microsoft’s goal isn’t to convert everyone into a Game Pass subscriber, though, according to Spencer. “Our goal is not to make everybody a game pass subscriber,” says Spencer in an interview with The Verge. “I’ve said many times that maybe 10-15 percent of our content and services revenue is subscriber revenue. It’s a good business for us today, Game Pass, but in no way is there a plan that says ‘Okay, everybody needs to become a Game Pass subscriber.’”
That said, Microsoft is still hoping to eventually grow Game Pass, particularly on mobile. The company is building an Xbox mobile gaming store to take on Apple and Google, but Apple’s recent App Store changes haven’t gone the way Microsoft was expecting. “Apple’s new policy is a step in the wrong direction,” says Xbox president Sarah Bond.
There’s also refreshed hope that we might see a native Xbox Cloud Gaming app on iPhones and iPads, thanks to Apple’s policy changes. It doesn’t seem like that’s going to happen just yet, though. “There’s not room for us to monetize Xbox Cloud Gaming on iOS,” says Spencer. “I think the proposals that Apple put forward … don’t go far enough to open up competition on the world’s largest gaming platform. We will continue to work with regulators, and Apple and Google, to create a space for alternative storefronts.”
Update, February 15th 4:35PM ET: Article updated to confirm the overall subscriber count includes Xbox Game Pass Core subscribers.
