Gamepass is profitable

[Otter]

JRPGfan said:

You would need to factor in the cost of running the service as well.
Also if you spend 1bn on 3rd party new content pr year.... what about the older content that remains on the service?
Same is true for 1st party games, even if the profits, can support like 4 gigantic 1st party games made, what about the cost of keeping older titles there?

Also is it enough to just be profitable?
How much more profitable is this, than say just selling the games the normal way?

Lets say if they just sold their 1st party, didn't spend 1bn on 3rd party, and made say ~2.5bn that way.....
Does this mean Gamepass is loseing them potential profits? they could have had just selling the games instead? Is that still profit? when its costing them money, they otherwise would have had?

Its not as dry and cut, as just saying it made 3bn in profits (I have no idea where that nr is from, I'm just running with it, since you used it).

The 1billion figure was given as a reference from Phil Spence in 2023 for third party spend annually/ It doesn't specify new games etc. This can also be in maintaining the gamepass library but ultimately we don't know. Same goes for service costs. 

The 3bn figure was just a crude lowball based off subscriptions numbers. Turns out there is more concrete evidence it's higher than this since it has grown since 2021

"CADE stated that the data had been provided directly by Microsoft, and in terms of Xbox Game Pass earnings on console, in 2021 the service generated a lofty $2.9 billion"

Gamepass was predicted to earn 5.5bn in 2025 by amphere, regardless of the accuracy of that analysis I think all evidence points towards them making a fair bit more than 3bn.

We know Xbox content and services revenue was around $17.5bn last year.


The teams securing games and maintaining servers etc could be 20m or 50m annually or even more? That'd make them either significantly bigger than any dev team or significantly higher paid but its still only a drop in the water. The servers and mainatainace, that is honestly anyones guess. But the point was that even lowballing revenue at 3billion, there is not an indication it is making a loss so the circle jerk of conversation of it not being sustainable should really wait on actual evidence of that and I think that is the wider point. Once you finally factor in that Xbox first party cost is not a "gamepass cost" since these games make their own revenue (at a varying amounts), I think the whole discussion falls flat and any sensible guess points towards it being e profitable endeavour.  

Last edited by Otter - on 08 July 2025