Key Takeaways
- • According to The Information, Microsoft's Xbox division was valued at between $100 billion and $150 billion in private equity exploratory discussions.
- • The talks were short-lived and strictly exploratory, with no formal negotiations ever taking place, and the firms involved remain unidentified.
- • Microsoft paid nearly $70 billion for Activision Blizzard King in 2022; subtracting that cost implies Xbox excluding Activision is worth roughly $30 billion to $80 billion.
- • Windows Central's commentary frames Xbox as back on track under CEO Asha Sharma, who recently dismissed concerns about the business shutting down in an interview with Fortune.
Summary
A new report from The Information states that private equity firms explored acquiring Microsoft's gaming business, with Xbox valued between $100 billion and $150 billion, according to the outlet. Rumors that Microsoft was willing to sell its entire Xbox division had circulated for some time, but the report indicates the interest was real, though it never progressed beyond exploration. The discussions were short-lived and no formal negotiations took place. The Information did not identify the firms involved.
The reported valuation range is notable when compared with Microsoft's 2022 acquisition of Activision Blizzard King for nearly $70 billion. Windows Central notes that subtracting that acquisition cost from the reported valuation implies Xbox without Activision would be worth between $30 billion and $80 billion, a wide band that reflects the uncertainty in the estimate.
Windows Central's commentary, written by a contributor rather than reported from the talks, argues that a private equity buyout would have been unlikely to outperform Microsoft's management of the division. It characterizes Xbox as having struggled over the past few years and says it appears to be recovering under CEO Asha Sharma, who recently dismissed concerns in an interview with Fortune that Microsoft would shutter the business.
The report's figures are presented as reported valuations rather than confirmed offers, and no transaction value or buyer has been disclosed.
The reported valuation range is notable when compared with Microsoft's 2022 acquisition of Activision Blizzard King for nearly $70 billion. Windows Central notes that subtracting that acquisition cost from the reported valuation implies Xbox without Activision would be worth between $30 billion and $80 billion, a wide band that reflects the uncertainty in the estimate.
Windows Central's commentary, written by a contributor rather than reported from the talks, argues that a private equity buyout would have been unlikely to outperform Microsoft's management of the division. It characterizes Xbox as having struggled over the past few years and says it appears to be recovering under CEO Asha Sharma, who recently dismissed concerns in an interview with Fortune that Microsoft would shutter the business.
The report's figures are presented as reported valuations rather than confirmed offers, and no transaction value or buyer has been disclosed.
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