Xbox's upcoming releases such as GTA 6, next-gen exclusives, and a console return might leave them out of the action - exploring the reasons for this potential sidelining
In the highly competitive world of gaming consoles, the Xbox Series X|S has faced continuous quarterly declines in hardware sales compared to the PlayStation 5. This trend, which began shortly after the consoles' release, has been largely attributed to a widening sales gap favoring the PS5.
As of June 2025, the PS5 has sold approximately 77.41 million units compared to 33.27 million for the Xbox Series X|S, giving the PS5 nearly 70% of the market share compared to Xbox's 30%. This gap has only grown in the past few months, with the PS5 selling nearly 0.87 million more units in the latest month alone.
Several factors have contributed to the Xbox's struggle. One significant factor is the PS5's consistent increase in global sales and market share, while Xbox’s share has shrunk by about 2.9% year-over-year. The PS5's success can be attributed to a variety of factors, including critically acclaimed exclusive titles like Spider-Man 2 and God of War Ragnarök, innovative hardware features such as the DualSense controller and ultra-fast SSD, and competitive pricing.
On the other hand, Microsoft’s Xbox has strengths in services like Xbox Game Pass, a strong backward compatibility system, and cloud gaming. However, while Xbox games are dominating US PlayStation game sales charts, this cross-platform strategy suggests Microsoft is prioritizing game ecosystem growth over exclusivity.
To reverse this trend, Xbox could employ several strategies. One such strategy is to invest in stronger and more exclusive first-party titles. By prioritizing developing or acquiring blockbuster exclusives that drive hardware purchases, Xbox could reduce the incentive for consumers to opt for other platforms.
Competitive pricing and bundling are another potential solutions. Lowering the Xbox Series X|S pricing further or bundling consoles with popular games or Xbox Game Pass could increase hardware sales, especially targeting price-sensitive consumers.
Hardware innovations and unique features could also set the Xbox apart. Enhancing console features beyond raw power, such as improving controller technology, faster storage, or exclusive VR support, could differentiate the Xbox experience.
Expanding Game Pass and cross-platform integration could also incentivize users to buy Xbox hardware. While the Game Pass strategy boosts game ecosystem revenue, integrating it with more devices or exclusive perks on Xbox consoles could encourage gamers to choose Xbox consoles over competing platforms.
Lastly, aggressive marketing and global supply chain management could help close the sales gap. Addressing any prior supply constraints, especially in key markets, and increasing marketing efforts focused on Xbox’s unique advantages may help reverse the current trend.
Despite these challenges, the Xbox Series X|S made a solid debut, occasionally edging out the PlayStation 5 in US sales according to Circana reports. The future of Xbox remains uncertain, but with strategic moves, Microsoft could regain its footing in the console market.
[1] Source 1 [2] Source 2 [3] Source 3 [4] Source 4
- Microsoft could strengthen their position in the gaming console market by focusing on developing or acquiring exclusive first-party titles to encourage hardware purchases.
- Lowering the Xbox Series X|S price or bundling consoles with popular games or Xbox Game Pass could help boost hardware sales, especially among price-sensitive consumers.
- Enhancing console features beyond raw power, such as improving controller technology, faster storage, or exclusive VR support, could differentiate the Xbox experience and set it apart from competitors.
- Integrating Xbox Game Pass with more devices or offering exclusive perks on Xbox consoles could incentivize gamers to choose Xbox over other platforms.
- Aggressive marketing and effective global supply chain management, including addressing supply constraints in key markets, could help close the sales gap and regain Microsoft's footing in the console market.
[1] Source 4 [2] Source 3 [3] Personal Speculation [4] Source 1 [5] Source 2 (implied)
