Microsoft CEO Satya Nadella has emphasized the importance of gaming as a business vertical in the recent earnings announcement. Nadella, who took over as only the third CEO of the company in its 40 years history in 2014, has diversified the business to focus on cloud and enterprise software services. However, during the earnings call, he emphasized how important Xbox division is for the company. During the last fiscal quarter, Microsoft said that the Xbox Live user base increased to 64 million active users and Nadella added that the gaming division is going strong.
The company reported during the second quarter for fiscal 2019, the company saw its revenue grow by 12 percent to $32.5 billion. Its operating income increased by 18 percent to $10.3 billion and the company reported 8 percent increase in gaming revenue, which was up 9 percent in constant currency terms. Microsoft said that the growth was contributed by Xbox software while the services business registered a growth of 31 percent. The gaming division contributed $4.23 billion in revenue during the last quarter and it is being attributed to strong sales from third-party resellers.
“We continue to pursue our expansive opportunity to transform how games are distributed, played, and viewed. Our investments in content, community, and cloud services across every endpoint drove both record user engagement and record average revenue per user, and contributed to our largest gaming revenue quarter ever, driven by software and services,” Nadella said during the earnings call. “We acquired two new studios this quarter, bringing the total to thirteen, and more than doubling our first-party content capacity in the past six months… Xbox Game Pass subscribers and Mixer engagement also hit new all-time highs,” he added.
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He also confirmed that public trial for xCloud will begin later this year and we could get more information at E3 2019, which starts on June 11 in Los Angeles. During the earnings call, Nadella also emphasized on how Minecraft is serving as a great acquisition for the company. “Minecraft delivered record revenue as we expanded into new platforms, geographies and segments like Education,” Nadella said.
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