Today's news that Xbox is raising prices on hardware and accessories globally comes as we learn about the company's success with its software and subscription businesses. Xbox held an earnings call on Wednesday and announced its financial results from January to March this year.
During this period, Xbox became the number one publisher on the PlayStation Store, proving that its controversial move to push its exclusive games to rival platforms was paying off. However, during the same period, Xbox hardware sales fell 6% year over year.
The decline in hardware sales comes as Xbox becomes the world's largest video game publisher. With fewer exclusive games to entice players to buy Xbox consoles, it's no surprise that its sales have declined. The company's "This is an Xbox" campaign suggests the venerable console maker is moving away from the idea that its first-party games will only be available on a single console platform. Xbox prefers to meet players on the platform they are on, a strategy that appears to be paying off, as revenue from the PC version of Xbox Game Pass increased 45% year over year, and cloud gaming reached a record 150 million hours of play during this period.
We are in a unique time in the video game industry. It's not often that a console raises its price years after its release. But this isn't an issue unique to Xbox, PlayStation has also recently raised PlayStation Plus subscription prices, and many expect the Nintendo Switch 2 to also increase in price after the current 90-day tariff moratorium ends.
Xbox may now be the number one publisher on both competing console platforms, but whether it can maintain that position remains to be seen. Xbox Game Studios has released some great games over the past few months, with more to come later this year, while PlayStation Game Studios has had a slower pace of game releases this year. It's easy to guess that games like Raiders of the Lost Ark, which released on the PlayStation platform on April 17, and Doom: The Dark Ages, which is scheduled to be released on May 15, are likely to lead in sales and pre-orders, but there aren't many games that compete with it.
Looking ahead to the rest of the year, PlayStation plans to launch Death Stranding 2 in June and Ghost of Mount Yotei in October, not to mention GTA 6 which has the potential to dwarf all other games. Xbox plans to release Obsidian Entertainment's The Outer Worlds 2 later this year, and while it's likely to be a great game, it may not keep Xbox at the top of competing platforms. Ultimately, it will be years before this strategic shift comes to fruition.