Microsoft’s (NASDAQ:MSFT) annual Xbox Games Showcase on Sunday revealed all-digital Xbox Series X and S consoles and trailers for over a dozen games, including the next installment of Call of Duty. The tech giant showcased three gaming consoles: a disc-less Xbox Series X and S, and a special edition of the Series X with 2 terabytes of storage.
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Microsoft’s games on display also featured Xbox’s most popular properties, ending a five-year wait for these games. This included Doom: The Dark Ages and the newest Gears of War. Many games, including the company’s Doom and Call of Duty, will be available on Xbox Game Pass at launch. This strategy highlights Microsoft’s focus on its subscription service amid a softer economy.
Gaming’s Role in Microsoft’s Revenues
The gaming industry is undergoing a challenging period, marked by declining sales, layoffs, and studio closures. However, Microsoft’s gaming business is doing well, with gaming revenues surging by more than 50% year-over-year to $5.5 billion in the first quarter. In the March quarter, gaming revenues comprised more than 7% of MSFT’s total revenues of $61.85 billion.
Is Microsoft Stock a Buy or Sell?
Analysts remain bullish about MSFT stock, with a Strong Buy consensus rating based on 32 Buys and one Hold. Over the past year, MSFT has increased by more than 25%, and the average MSFT price target of $493.56 implies an upside potential of 16.5% from current levels.
