Microsoft Debunks Claims They Almost Closed Their Gaming Division, Revenue Consistently Up Since Activision Deal

Microsoft has gone on the record that an earlier alleged insider report about their financial performance was factually incorrect.

A report from earlier this week claimed that Microsoft CEO Satya Nadella almost chose to close Microsoft’s gaming business in 2021. We reported on that claim, but not on subsequent claims that the gaming business is still not doing well after their purchase of Activision. Their claims did not match up with Microsoft’s claims of Call of Duty Black Ops 6’s success.

Today, Insider Gaming reached out to Microsoft, and they were able to confirm all of those claims were not correct. In Microsoft’s words, the report was “through omission misrepresenting the business.”

First things first, Xbox content and services revenue have been consistently going up from the second quarter of financial year 2024 to the first quarter of financial year 2025. Each quarter, they also attribute 85 % revenue increase from Activision.

Microsoft also reminded Insider Gaming that the same Satya Nadella talked to investors about how the gaming division became profitable last October, saying that it is “positioned for long-term growth”.

Nadella also said that Call of Duty Black Ops 6 “set a new Q1 record for total revenue and average revenue per subscriber,” as we correctly recalled. Regarding the claim that Nadella could have closed their gaming division, they pointed to this statement in October that Microsoft was “all in on gaming.”

Microsoft ended their statement to Insider Gaming by reiterating they have “well over 500 million monthly players and over the last year, we’ve seen consistent growth in monthly users on cloud”.

To sum up, Microsoft’s claims are that nothing in that earlier report, from a non-gaming subscription website called The Information, was correct at all. If The Information has insider sources that can disprove Microsoft’s claims, now would be a good time for them to show it.

But Microsoft is legally bound not to misrepresent their financial performance, and given the company’s size and success and track record, they are not likely to and have no motivation to mislead the public and their investors on this. Given that Microsoft can rest on the trustworthiness of their financial data, everything else in The Information’s report must also be called into question.

Perhaps part of the reason it was easy to believe that report was Microsoft’s policy of deliberately hiding information from the public, and so we wanted to believe any such report could be correct. But in hindsight, Microsoft controls that information for a reason; because they are no longer interested in their business being used as a talking point by fans and content creators. For all we know, their Surface and Xbox business will exceed iPad’s and PlayStation’s business someday, and we simply won’t notice until Microsoft has a press release about it.

But at the very least, we should be discriminating in all these reports, rumors and claims, and considering if they simply confirm our prior assumptions, or if the sources can truly be trusted. You can rest assured we would be apply this to our work as well.