Xbox chief executive Phil Spencer has said the company added 200 million players in its latest fiscal year, but this expansion did not stop gaming revenue from declining. He said Xbox needs to “close that gap”, signalling that Microsoft is under pressure to convert audience growth into stronger and more dependable income.

The figure refers to new players across the wider Xbox ecosystem rather than necessarily console sales alone. The reported revenue fall shows that a larger player base has not been sufficient to offset weaker spending or other financial pressures within Microsoft’s gaming division.