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[fred420170]

They are now a 4trillion dollar company. I think their financial analysts know more than you do. in your basement.

 

[BlackTron]

If the revenue is so good, why are they firing so many workers?

If the game is making money, what do we need these people for again?

 

[PlayStaytion]

Ryan McAffrey must make his own version of last stand podcast like Colin Moriarty, otherwise, he's irrelevant at this point.

 

[Cakeboxer]

Assumptions. Yeah...ok

Correct, assumptions and observations. Some people just keep falling for it over and over but never end up on the ban list. Did you expect leaked documents and videos from the annual mod meeting?

 

[Topher]

Correct, assumptions and observations. Some people just keep falling for it over and over but never end up on the ban list. Did you expect leaked documents and videos from the annual mod meeting?

No, it's what I expected

 

[SILKYSMOOTH30FPS]

Could very well be. I'm just saying it's a long burn. Netflix mastered it and now does pretty well for itself.

nextflix might an entertainment renting service, but when you look at what's on offer, and how much more expensive and how much longer game development takes, GP and Netflix cannot be compared.

 

[DenchDeckard]

Sony is doing it at a different scale, due to incompetence, and switching gears.

Microsoft is doing it as a symptom of being Microsoft and will only double down while scheming further.

It doesn't matter the reason. one is not worse than the other.

Go talk to someone who just lost their job at MS or a sony studio and tell them thats the reason why and see if they give a fuck.

 

[IFireflyl]

We lack some of the most important information to be able to discuss this properly.

How and what do Netflix pay?

How and what do MS pay?

In theory there could be a counter argument that you are saying ms pays out more to devs so developers are actually getting a good deal. Which crushes the complaint that gamepass isn't healthy for the industry.

You're right that we don't have full transparency into Netflix or Microsoft's exact payout structures, but that's not necessary to assess the larger point. The core issue isn't how much Microsoft pays developers. The core issue is that:

• Game Pass is still not profitable.
  • Microsoft has claimed that Game Pass is profitable, but they also obfuscate all data surrounding profitability.
  • Most sane people would agree that this is not the type of behavior it would expect a company to engage in, both publicly and with regards to the companies shareholders, if they could easily prove these assertions to be true.
• Major first-party titles like Starfield didn't recoup development + marketing budgets.
• The service requires massive upfront investments for content that takes years to produce (sometimes close to a decade!) and consumes more labor per unit than movies and TV shows.

Even if Microsoft is generous to developers, that doesn't make the model healthy or scalable. Paying generously for games that don't break even is unsustainable. If the model requires Microsoft to lose money and overpay just to keep developers from fleeing, that's a red flag, not a win. The "we don't know" argument doesn't refute the concrete evidence we do have:

• Netflix is profitable.
• Game Pass is likely not profitable based on the previously provided information.
• Netflix scales rapidly because shows are cheaper and faster to produce, and people consume them passively.
• Game Pass is bottlenecked by development time, development costs, and user time (games take 10–100 hours each).
• Netflix adds thousands of new pieces of content yearly. Game Pass adds a few dozen.

There's a reason developers like Larian and Remedy have publicly walked away from Game Pass:

• It kills long-tail sales.
• It forces developers into launch-day payouts that don't cover ongoing revenue.
• It turns games into a commodity in a way that undermines premium pricing and value perception (e.g. why pay for the game when I can get it for "free").

So even if MS is paying more per piece of content than Netflix, the outcome is still:

• Game Pass = high cost, low ROI, low scalability.
• Netflix = high ROI, high scalability, higher profit margins.

The burden is on defenders of Game Pass to show how that model becomes profitable, not just that Microsoft can afford to burn cash. Unless Game Pass radically shifts direction, it's simply an expensive promotional tool, not a viable Netflix-style platform.

 

[BlackTron]

It doesn't matter the reason. one is not worse than the other.

Go talk to someone who just lost their job at MS or a sony studio and tell them thats the reason why and see if they give a fuck.

Complete disagreement, of course the reason matters. Sony made a mistake while having a lapse. For Microsoft, it wasn't a lapse. They're running the company the same way they always have for decades, where half the destruction is even seen as a good and planned part of the process and the other half is a bonus due to their own incompetence.

 

[calico]

The difference in financial clout is why one is worse than the other, or at least has the potential to be.

 

[IFireflyl]

We can't see warnings so how do we know anyone gets a free pass?

It is anecdotal, but one example would be this post that I reported:

Post in thread 'Passport Bros. 🛂'

Jul 6, 2025

What you say is true.

Obviously I'm exaggerating, but women's standards for my generation have skyrocketed.

I understand you, my friend... From my own experience... DON'T DESPAIR OVER A WOMAN.


I now have three girlfriends. I go out with them occasionally, and thanks to not worrying and not letting pressure get to me, I still have them....

Believe me, in Mexico the woman they're hateful and crazy. You marry them and after 5 or 6 months they ask for a divorcie and take off your money and stuff.

That's why I'm very careful.

The secret is that we have...

• Heimdall_Xtreme

• 

I'll say it bluntly, but it's the truth: women are disposable at 30 years or older.

Maybe my reporting of this was just missed by accident, but moderation never did anything with this post or user. People get banned for making racist comments (rightly so), and I don't see the distinction here.

However, I don't want to make blanket statements. As I said, it's possible my reporting of that post was just missed by the moderation team. I'm not going to keep reporting it, because if they didn't miss it then I'll likely just piss someone off if they think that post is acceptable somehow.

 

[Rockman33]

Even if that's true (and we're accepting that without evidence), Netflix also delivers orders of magnitude more content than Game Pass.
Let's do the math:

• Netflix: ~7,500 unique titles (around 4,500 movies, 3,000 TV shows)
  • Each show has multiple episodes. 2024 alone added over 10,000 episodes.
  • Conservatively, the platform hosts 33,000–35,000 individual pieces of content (movies + episodes).
• Game Pass: ~450–500 games

That means Netflix has 66x more content than Game Pass on the low end. So Netflix spending 6–8x more for 66x more content isn't a point against Netflix; it's a point in favor of Netflix and against Game Pass. Let's break it down even further:

Service	Monthly Price	Approx. Content Count	Cost per Title
Game Pass Ultimate	$19.99	~500 games	~$0.04/title
Netflix Premium	$24.99	~33,000 titles	~$0.0007/title

Netflix provides ~57x more value per dollar just based on quantity. And that's before you even consider accessibility (games require time, hardware, and skill) versus the low barrier of watching a show.

Also, look at their financials:

• Netflix (2024)
  • Revenue: $39B
  • Expenses: $30.3B
  • Net Income: $8.7B
  • Profit Margin: ~22%
• Microsoft Gaming Division
  • Game Pass still isn't profitable.
  • Starfield cost $300 to $400 million to develop and market, and couldn't even break even.
    • Estimated sales revenue: ~$280M
    • Estimated loss: $20M+ (on best-case scenario)

Games cost more and take longer to make. Developers are increasingly hesitant to put their titles on Game Pass because they risk cannibalizing sales for a one-time payout. Microsoft is betting on a model that is far less scalable than Netflix. To bring this home in response to your original statement:

• Netflix should spend more because it has far more to offer.
• Netflix is profitable. Game Pass is not.
• Netflix's content is cheaper per unit, faster to produce, and easier to access.

Game Pass is the one failing to deliver ROI by every meaningful metric. Unless Game Pass radically changes its model or content strategy, I don't see how it could ever become profitable, let alone reach Netflix's level of success.

Not sure why I got a ChatGPT breakdown… All I was saying is they DEFINTELY don't spend the same amount. Wasn't talking about quality or production. Just the simple fact Netflix far outspends Gamepass so it's a bullshit comparison.

Take a breath and relax.

 

[Karim]

Xbox Game Pass revenue reached a new record for Xbox over the last year, achieving "nearly $5 billion" in revenue for the first time.

This comes from the company's Q4 and full-year earnings results, covering the last twelve months ending June 30, 2025. While CEO Satya Nadella announced the milestone on the call, he did not provide specific revenue numbers for Game Pass.

Nadella also did not share subscriber numbers. That said, Game Pass subscribers are confirmed to have reached 34 million back in February 2024, and a Microsoft employee's profile suggested just two months ago that this number had reached 35 million, though this is unverified.

Some of that growth likely comes from price hikes on the service that kicked off in July of last year. But it hasn't hurt that Xbox dropped a number of new first-party games on Game Pass especially in the last quarter of the fiscal year, including The Elder Scrolls: Oblivion: Remastered, Doom: The Dark Ages, and Indiana Jones and the Great Circle.

Overall, gaming revenue for Xbox was up 10% year-over-year and Xbox content and services revenue was up 13%, driven by growth in first-party content and yes, Xbox Game Pass. Hardware revenue was down year-over-year by 22%.

Despite these increases, Xbox recently laid off hundreds of workers across various parts of its gaming business and canceled multiple projects, including Everwild and Perfect Dark.

Xbox Game Pass Revenue Was 'Nearly $5 Billion for the First Time' Over the Last Year - IGN

Xbox Game Pass revenue reached a new record for Xbox over the last year, achieving "nearly $5 billion" in revenue for the first time.

www.ign.com

---

Here is the direct quote and the transcript from the earnings call:

"And Game Pass annual revenue was nearly $5 billion for the first time."

https://view.officeapps.live.com/op/view.aspx?src=https://microsoft.com/en-us/investor/earnings/FY-2025-Q4/Document/DownloadDocument/65/TranscriptQandAFY25q4.docx

 

[IFireflyl]

Not sure why I got a ChatGPT breakdown… All I was saying is they DEFINTELY don't spend the same amount. Wasn't talking about quality or production. Just the simple fact Netflix far outspends Gamepass so it's a bullshit comparison.

Take a breath and relax.

You got an educated breakdown of the two services, nothing more. Your response that they don't spend the same amount was pointless. Sony, Microsoft and Nintendo all have wildly different spending. People compare them all the time. You don't get to dismiss the comparison because the amount they spend, which is a single variable, is different (even wildly so).

And what about my response indicates that I wasn't relaxed? There was nothing in my response that indicated that I was doing anything other than providing context.

 

[Tobimacoss]

Netflix spent upwards of 29bil last year

Dang. Yea, my data is from around 2023, I knew they were spending most of their revenues. But $29 billion is absolutely crazy. Most expenses of any other streaming service.

Even Disney+ and HBO Max are less than $8-10 billion.

But overall point is, it is much cheaper to fund and maintain a gaming service than it is to fund a movies and TV service. Plus only one other competitor (PS+ Premium) which refuses to compete properly.

 

[Beechos]

These numbers prob also include any purchases made with gamepass. Like discounted games, dlc, season passes.

 

[Rockman33]

You got an educated breakdown of the two services, nothing more. Your response that they don't spend the same amount was pointless. Sony, Microsoft and Nintendo all have wildly different spending. People compare them all the time. You don't get to dismiss the comparison because the amount they spend, which is a single variable, is different (even wildly so).

And what about my response indicates that I wasn't relaxed? There was nothing in my response that indicated that I was doing anything other than providing context.

I was LITERALLY disputing the point that Gamepass does not spend nearly as much as Netflix per year. Which I was right about. That's all.

Go touch some grass.

 

[Rockman33]

Dang. Yea, my data is from around 2023, I knew they were spending most of their revenues. But $29 billion is absolutely crazy. Most expenses of any other streaming service.

Even Disney+ and HBO Max are less than $8-10 billion.

But overall point is, it is much cheaper to fund and maintain a gaming service than it is to fund a movies and TV service. Plus only one other competitor (PS+ Premium) which refuses to compete properly.

I think Netflix has a much larger active subscription worldwide than either of those and also charges more. Letting them spend so much more.

I completely agree.

 

[Neofire]

Game Pass Ultimate will be $30 at some point and you people will still act like it's not profitable.

Because overall it's not and it's also detrimental to developers.

 

[Ozzy Onya A2Z]

Still cracks me up it's been stated many years now as profitable and large revenue. Keep on GAFfing though.

 

[ByWatterson]

If you're okay with playing what's on there, when it's on there, maybe.

I'd rather choose what I want to play and when I want to play it.

Exactly. If you're an adult with a job, and you even sort of regularly want to play games not on Gamepass, you simply won't have enough available waking hours to get the value out of Gamepass to reflect the money you pay in.

The only way to make the value work is to play only Gamepass games (which is what Xbox customers do now and why nothing sells over there).

 

[IFireflyl]

I was LITERALLY disputing the point that Gamepass does not spend nearly as much as Netflix per year. Which I was right about. That's all.

Go touch some grass.

Why do you keep adding an insult at the end of your comments when I am being civil? Are you 12 years old?

This was the full post:

It... probably won't be. As a reminder, it took Spotify 10+ years and 100 million+ subscribers to break even. It took Netflix 15 years and 150 million+ subscribers to become profitable.

Game Pass is at a fraction of their user base, and the production costs associated with video games are substantially higher than those linked with movies, music, or TV. I am sorry to tell you that the math works against Game Pass at the best of times, and that's before accounting for any inflated expectations for it that may exist within the parent company after springing for a $70 billion acquisition.

You're out of your mind if you think Gamepass which would include all of their developers and the service itself is anywhere close to how much Netflix spends a year. Netflix probably spends 6-8x times as much.

Nothing about this post you were quoting said anything about Game Pass spending as much as Netflix. What they said was, "...production costs associated with video games are substantially higher than those linked with moves, music, or TV."

So good on you for disputing a point that nobody made, and then behaving like a child when people responded in a civil manner with relevant facts because we didn't understand that your point was nonsensical from the start.

Dang. Yea, my data is from around 2023, I knew they were spending most of their revenues. But $29 billion is absolutely crazy. Most expenses of any other streaming service.

Even Disney+ and HBO Max are less than $8-10 billion.

But overall point is, it is much cheaper to fund and maintain a gaming service than it is to fund a movies and TV service. Plus only one other competitor (PS+ Premium) which refuses to compete properly.

It is objectively more expensive to fund and maintain a gaming subscription service than it is to fund a movies/TV service because there is an equally high cost and a longer development time to make games versus movies, music, and TV. Netflix has been profitable since 2003. And not in a "they said it so it must be true" way, but in a "they provided us proof in the form of revenue and expenses" kind of way. It took Netflix six years to be verifiably profitable. Game Pass has been operational for 8 years, and the only thing we know is that they said, "We're profitable. Source: trust us."

Microsoft should happily be showing the receipts on Game Pass' profitability, but they don't provide raw numbers for this to either the public, the SEC, or to shareholders. They only supply selective metrics. If Game Pass were truly profitable then they would be declaring this to the world. Everyone should be suspicious of Microsoft's profitability claims for Game Pass since they share specific revenue and market segment information for Azure, LinkedIn and Office 365, but not for Game Pass.

 

[calico]

Based on some of the optimistic accounting in this thread, operating the system costs nothing and the Game Pass marketing (which I see everywhere) costs nothing. Microsoft, apparently, assigns the development costs to Not-Game-Pass because the game isn't exclusively available on Game Pass.

'It's been stated as profitable' is meaningless if Game Pass expenses are being handwaved or creatively shifted elsewhere with the aim of being able to state that the service is profitable. Maybe it's profitable with honest and reasonable accounting and maybe it isn't.

It would also be reasonable to consider the negative effect Game Pass has on game sales on Xbox. Game Pass could be profitable and still be a mistake if it's causing the loss of a greater profit elsewhere in the business.

 

[Det]

According to which analysts?

Source ?

Daniel Ahmad commented on this a long time ago, but it's impossible to find it amidst all the talk about GamePass.
Well, this is part of Phil Spencer's communication strategy, talking non-stop so that one lie is buried by another and another and another promise.

I had a hard time finding, for example, Phil promising that "the big Xbox games weren't released on PC" when they started making PC ports.
It's the same with all the information you search for about anything related to Xbox.
Xbox's strategy is to fill its brand communication with noise so they can fanaticize their fans.

That's why I expected I wouldn't be able to find ZhugEX's tweet saying that GamePass would need 50 million subscribers to break even.

 

[adamsapple]

Daniel Ahmad commented on this a long time ago, but it's impossible to find it amidst all the talk about GamePass.

That's why I expected I wouldn't be able to find ZhugEX's tweet saying that GamePass would need 50 million subscribers to break even.

 

[Gravemind]

Still cracks me up it's been stated many years now as profitable and large revenue. Keep on GAFfing though.

It's more fun to just say xboc ded