Xbox Game Pass subscription goals fell short of Microsoft’s goals, according to a new financial document from the tech giant. According to a report by Axios, Microsoft was targeting a 73% gross rate for Game Pass in the last fiscal year ending June 30, 2022. The service grew by 28%.
These targets are tied to the compensation of Microsoft CEO Satya Nadella. The company also failed to hit a similar marker in fiscal 2021. However, in fiscal 2020, Game Pass subscriptions exceeded expectations. Other goals that would affect CEO salary include Microsoft Cloud revenue, Teams usage, and LinkedIn sessions. Overall, Nadella received a payment of $55 million in stock and cash.
At the Wall Street Journal Tech Life Event, Microsoft Gaming CEO Phil Spencer said that Game Pass is profitable and that PC sign-ups are seeing tremendous growth, even though console sign-ups are decreasing. He also alluded to possible price increases after the holiday season. Xbox Game Pass is currently $9.99 a month for PC or console. Game Pass Ultimate, for $14.99 a month, is a bundle that includes the Game Pass for PC and Console, plus Xbox Live Gold. Microsoft does not disclose any sales data regarding Game Pass. However, it announced in January 2022 that the service had reached 25 million subscriptions.
The market power of Game Pass has been a key part of Sony’s objections to Microsoft’s continued acquisition of Activision Blizzard. The UK’s Competition and Markets Authority echoed Sony’s concerns, leading to a counter-statement by Microsoft. Last week, an anonymous shareholder sold a huge amount of shares in Activision Blizzard, reflecting a possible lack of confidence that the deal would go through.
This article is a translation of the writing by Grace Benfell to the website GameSpot.
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