Microsoft’s market share in the UK console space is expected to drop even lower in 2025, as Xbox continues to prioritise Game Pass.
Sales of the Xbox Series X/S have been dropping at an alarming rate over the past few years, but things took a significant turn at one retailer last month.
Across both its online and physical stores in the UK and US, Costco has quietly stopped selling Xbox consoles. While not a major retailer in the UK, it’s likely a sign of things to come, as Microsoft continues to pitch Xbox as a multi-device platform via Game Pass.
A new report has highlighted just how much Xbox console sales have dropped over the past few years, and it’s hard to see any positive spin for Microsoft to latch onto.
According to data from NielsenIQ/Gfk Entertainment, as supplied to GamesIndustry.biz, the Xbox Series X/S had a 31% share of UK console sales in 2022, two years after it launched in 2020. While not great to begin with, this is predicted to drop to just 13% in 2025.
As a percentage of the market, this statistic is an alarming indicator of Xbox’s dwindling mindshare, especially as the UK is the format’s only major market outside of North America.
There are no figures for the other consoles, but given the UK is Nintendo’s weakest international market it’s likely dominated by the PlayStation 5 – even though the Switch 2 is the fastest selling console ever worldwide.
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It’s a similarly bleak picture in terms of physical game sales in the UK, although it’s worth noting that Xbox players have typically favoured digital purchases more than other console players. Even so, the Xbox Series X/S accounted for just 11% of physical game sales in the UK in 2022, which is predicted to fall to just 6% this year.
In comparison, Nintendo are predicted to hold 52% and Sony 42% of physical game sales in 2025, an increase from 48% and 40%, respectively, in 2022.
While you could blame some of this decline on a change in strategy, as Microsoft pivots towards emphasising Game Pass across a multitude of devices, including its upcoming Asus handhelds, no company benefits from falling sales – so it’s still a troubling sign.
If anything, the lack of presence and interest in stores will likely damage Xbox as a brand, as it becomes less visible to casual and non-gamers, in comparison to Nintendo and Sony – something which could hurt their chances of success with their planned next generation console.
As it continues to deemphasise the importance of Xbox consoles, there are rumours Microsoft is planning to shake-up Game Pass in a significant way this week.
According to ResetEra user Slayven, who has heard from a source that has ‘been right in the past’, Microsoft is set to introduce a cheaper Game Pass tier with adverts in 2026, along with another price hike to $25 for Game Pass Ultimate.
None of this has been confirmed, but known insider extas1s has also claimed a big Game Pass related announcement is planned for today (October 1), and an ad-based tier has been rumoured for some time now.
