Microsoft to share revenues on new Xbox consoles with GameStop

Retailer GameStop and Microsoft seemed to have reached an agreement on a new partnership. This will see GameStop directly benefit from the revenue Microsoft earns from the sales of Xbox Series X and S consoles through their stores.

Investment Advisor DOMO Capital Management has advised on Twitter that they have received confirmation that the partnership has been solidified. The result is that GameStop will benefit from some of the downstream revenue for any new customers it brings to the next-generation of Xbox consoles.

The deal breaks down to GameStop receiving a slice of any digital revenue a customer makes for Microsoft via digital purchases. This includes full game downloads, and any add-on content. The only requirement is that the consumer must have purchased their console from one of GameStop’s store locations.

DOMO explains that this deal even extends for DLC purchased for a game that the consumer has bought a physical copy of. It also applies to all pre-owned Xbox Series X and S consoles that GameStop sells. All they need to do is report the number of units they have sold to Microsoft.

At the time of writing it isn’t clear whether Sony has reached a similar deal with the platform manufacturer. Considering the stark difference between the two companies in their approach to this next-generation of gaming, it would seem safe to assume that they haven’t.

GameStop confirmed that they had reached a multi-year strategic partnership with Microsoft earlier in 2020. This digital revenue share was only hinted at, with the bulk of the partnership documentation focusing on back-end software for running GameStop stores.

Earlier this year GameStop announced that they would be closing a total of 450 stores before the end of the current financial year. This is just the latest advancement of the company’s ongoing issues in the face of more consumers moving online to purchase their gaming hardware and software.

GameStop has appeared to be in a lot of financial trouble over the last three years or so. This could be a lifeline for the company. With Microsoft offering such a generous revenue sharing deal, GameStop will now benefit from every single digital purchase an Xbox user makes after buying their console from the company. This could see them through to safer shores in the long term.