Xbox chief strategy officer Matthew Ball confirmed at Summer Game Fest that Game Pass lost millions of subscribers within months of the 50% Ultimate price hike in October 2025. New CEO Asha Sharma has since cut prices and reshaped the service’s strategy.
Xbox Game Pass lost millions of subscribers in the months following its massive October 2025 price increase. Xbox chief strategy officer Matthew Ball confirmed the scale of the damage during a Summer Game Fest appearance at The Game Business Live on June 8, 2026, telling the audience: “We shed millions of subscribers over the span of a few months.” The last publicly confirmed subscriber count was 34 million as of February 2024, making the loss a significant blow to one of gaming’s biggest subscription services.
What Happened in October 2025?
On October 1, 2025, Microsoft overhauled the entire Game Pass structure. Tiers were renamed: Game Pass Core became “Essential” and Standard became “Premium.” The real controversy was the pricing. Game Pass Ultimate jumped 50% from $19.99 to $29.99 per month. PC Game Pass climbed nearly 40%, from $11.99 to $16.49. In exchange, Microsoft added Ubisoft+ Classics, Fortnite Crew, and expanded Xbox Cloud Gaming access to more tiers.
The backlash was immediate and overwhelming. So many subscribers attempted to cancel at once that the Microsoft website buckled under the load and failed to process requests properly. Across social media, players organised mass cancellation campaigns, and the discontent quickly became one of the biggest stories in gaming.
The $300 Million Call of Duty Problem
The price hike did not exist in a vacuum. Bloomberg reported in October 2025 that Microsoft had given up more than $300 million in Call of Duty sales on console and PC in 2024 by including Black Ops 6 in Game Pass at launch. PlayStation accounted for roughly 82% of all Black Ops 6 sales, a stark reminder that Game Pass inclusion was cannibalising revenue rather than expanding it. The 50% Ultimate price increase was widely interpreted as Microsoft’s attempt to offset that loss, a move that backfired dramatically.
As one analyst put it, “Game Pass hasn’t delivered the explosive growth Microsoft anticipated post-Activision, and they’ve realized their infrastructure costs don’t align with their pricing model.” The tension between subscriber growth and revenue per user had reached breaking point.
Asha Sharma Steps In and Reverses Course
Phil Spencer departed as head of Xbox, and Asha Sharma took over as CEO of Microsoft Gaming in February 2026. Within weeks, she began reshaping the Game Pass strategy. In a leaked internal memo from April 2026, Sharma told employees that Game Pass had “become too expensive for players” and the company needed “a better value equation.”
On April 21, 2026, Sharma publicly announced price reductions. Game Pass Ultimate dropped from $29.99 to $22.99 per month. PC Game Pass came down from $16.49 to $13.99. The catch: future Call of Duty titles would no longer join Game Pass on day one. Instead, new entries would arrive roughly a year after launch, during the following holiday season. Existing Call of Duty games already in the library remained available.
Current Game Pass Pricing at a Glance
| Tier | Pre-Hike Price (US) | Oct 2025 Hike | Current Price (US) |
|---|---|---|---|
| Game Pass Ultimate | $19.99/mo | $29.99/mo | $22.99/mo |
| PC Game Pass | $11.99/mo | $16.49/mo | $13.99/mo |
| Game Pass Premium | $14.99/mo | $14.99/mo | $14.99/mo |
| Game Pass Essential | $9.99/mo | $9.99/mo | $9.99/mo |
The current Ultimate price of $22.99 is still $3 higher than the pre-hike level but $7 cheaper than the controversial $29.99 peak. In Europe, Ultimate had risen from €14.99 to €17.99 during the October changes, and regional rollback amounts varied by country.
An Eight-Month Decline Finally Reversed
At Summer Game Fest in early June 2026, Sharma revealed that Game Pass had experienced an eight-month decline before finally returning to growth. “We’ve been able to reset Game Pass after an eight-month decline. It’s now returned to growth and expanding revenue retention,” she said. In a May 2026 internal memo, Sharma had also confirmed: “Growth slowed down and subscriber loss accelerated after the pricing and SKU changes last year. Since our price reduction we have seen acquisitions grow and retention improve, which is a good first step.”
Matthew Ball echoed the improving sentiment, saying the changes to Game Pass are now “resonating” with users. However, Sharma was careful to temper expectations: “We will not solve this in one moment or one launch. We will have to outwork the problem in front of us in our path to restore durable growth.”
How Many Subscribers Did Xbox Actually Lose?
The exact number remains undisclosed. Ball described it as “millions” without further specificity. Microsoft’s last confirmed figure was 34 million total subscribers in February 2024. A LinkedIn page of an Xbox programme manager later leaked a 35 million figure in mid-2025, but without tier breakdowns. Some third-party estimates in early 2026 suggested the total had risen to roughly 35 to 37 million before the October hike. If “millions” means anywhere between 3 and 10 million, the subscriber base could have dropped to well below 30 million at its lowest point.
Despite the subscriber losses, Game Pass still generated nearly $5 billion in annual revenue during Microsoft’s fiscal year 2025, a record figure. The higher prices appear to have partially compensated for lost volume in the short term, but the long-term brand damage and churn were clearly unsustainable enough to prompt leadership change and a strategy reversal.
What Comes Next: Cheaper Tiers, Ads, and a Netflix Bundle?
Sharma’s plans go beyond a single price cut. According to The Information, she is exploring new lower-priced Game Pass tiers below the current $9.99 Essential level, potentially as low as $5 to $8 per month. One strong possibility is an ad-supported tier, similar to Netflix’s approach, where players could access Game Pass games or Xbox Cloud Gaming with advertisements in exchange for a much lower subscription fee.
Perhaps most intriguingly, Netflix co-CEO Greg Peters confirmed that he and Sharma have “kicked around ideas” for a potential subscription bundle combining Game Pass and Netflix. No concrete deal has been announced, but the logic is compelling: Netflix’s 300 million subscribers would gain exposure to Game Pass, while Game Pass’s tens of millions of users would see Netflix promoted. If it materialises, such a bundle could dramatically lower the barrier to entry for both services.
Windows Central also reported that Xbox Cloud Gaming will gain ad-supported access in 2026, suggesting the infrastructure for a free or near-free tier is already being built.
Is Game Pass Still Worth It Without Day-One Call of Duty?
This is the central question for many subscribers. At $22.99 per month, Ultimate still includes over 400 games, day-one access to Xbox Game Studios titles (excluding Call of Duty), EA Play, Ubisoft+ Classics, Fortnite Crew, and cloud gaming across devices. The library remains one of the most comprehensive in gaming.
However, Call of Duty was the single biggest driver of Game Pass sign-ups in recent years. Its removal as a day-one feature fundamentally changes the value proposition for a segment of the audience. Those who subscribed primarily for annual Call of Duty access now face a choice: pay full price for the game at launch or wait roughly a year for it to land on Game Pass.
For players who value variety and discovery, the reduced price arguably makes Game Pass more appealing than it was at $30. For those whose subscription hinged on one franchise, the trade-off is less clear.
Things Players Usually Ask
How many subscribers does Game Pass have now?
Microsoft has not released an updated official count since the February 2024 figure of 34 million. Third-party estimates placed it around 35 to 37 million before the October 2025 hike. After losing “millions,” the current number remains unknown but likely sits somewhere in the low-to-mid 30 million range, with recent growth trending upward again since the April 2026 price cuts.
Will Call of Duty ever return to Game Pass on day one?
As of now, Microsoft has confirmed that future Call of Duty titles will arrive on Game Pass approximately one year after launch. There has been no indication this policy will be reversed. Existing Call of Duty titles already in the library remain playable for subscribers.
Who is Asha Sharma?
Asha Sharma became CEO of Microsoft Gaming in February 2026 after Phil Spencer’s departure. She previously held senior roles in AI at Microsoft. Since taking over, she has cut Game Pass prices, pushed for a return to Xbox console exclusivity, and cancelled the criticised Gaming Copilot feature. Despite initial scepticism about her lack of gaming industry experience, she has been broadly praised for acting quickly on player feedback.
Is Xbox still making consoles?
Yes. Matthew Ball stated at Summer Game Fest that Xbox has no plans to stop manufacturing consoles and that demand for Xbox hardware currently exceeds supply. The company is working to increase production to meet demand.
Could Game Pass get even cheaper in 2026?
Reports suggest Sharma is actively exploring new lower-priced tiers, potentially including an ad-supported option. Discussions with Netflix about a subscription bundle have also been confirmed by Netflix’s co-CEO. However, none of these plans have been officially announced yet, and specifics remain speculative.
