Microsoft Rethinks Xbox Game Pass Strategy After Call of Duty Revenue Drop and Considers Ending Day One Franchise Releases to Offset Losses
Microsoft is considering a major change to Xbox Game Pass. The company might stop putting new Call of Duty games on the subscription service on launch day. Jez Corden reported on a recent podcast that removing the franchise from day one availability is a distinct possibility based on information he has received.
The potential policy change follows a difficult financial period for the Xbox division. In January 2026, Microsoft reported a 9 percent decline in gaming revenue compared to the same quarter last year. The company also saw a 5 percent year over year drop in content and services growth, indicating that the current Game Pass model is no longer attracting enough new subscribers to offset retail losses.
Industry analysts have warned about the financial toll of the subscription model. In early 2025, Christopher Dring noted that titles launching on Game Pass lose roughly 80 percent of their expected premium retail sales on Xbox consoles. He cited prior Microsoft releases like Starfield and Indiana Jones and the Great Circle as victims of this cannibalization. Bloomberg previously estimated that putting Black Ops 6 on Game Pass in 2024 cost Microsoft up to $300 million in lost retail revenue.
The financial strain compounded with the release of Call of Duty: Black Ops 7. The latest entry failed to meet internal expectations, suffering from historically low player counts on Steam and losing audience share to EA’s Battlefield 6. A leaked document from a lawsuit involving former Activision Blizzard CEO Bobby Kotick revealed that overall Call of Duty sales plummeted by 60 percent in 2025.
Microsoft is looking at different ways to stop the revenue bleed. One proposed strategy is to delay the Game Pass arrival of future Call of Duty entries by several months, forcing dedicated players to purchase the game at full price on launch day. Another option involves removing the blockbuster franchise from the Game Pass Ultimate tier entirely, which could allow Microsoft to lower the monthly subscription price after recent unpopular rate hikes.
