Misleading headline from Gamespot. I watched the segment from the podcast they "sourced" this from. He never said it was not making money/not a money maker. Time stamped.
To paraphrase, he says "do not worry about MSFT, we aren't hurting. It is a different mindset about delivering value to customers and growing subcount."
Clearly, they have 10MM+ subs and I am sure they are hoping to double that number in the next year. That is a tremendous amount of revenue.
I think where people are getting hung up is on him saying "it's not a big profit play". I believe what he is getting at is the fact that MSFT could sell Halo, Avowed, Forza, etc for $60 and try to maximize profit that way. Instead they have found that by adding them to Game Pass they make money as they grow subscribers and as those subs buy micros within the games they are now getting as part of their sub. It is a different "play" revenue by subscriber volume vs revenue by sales volume. Same thing MSFT has done with Office, Windows, Azure etc. It fits into their SaaS model.
I think it is safe to say Game Pass is making plenty of money given MSFT's Xbox revenue from their year end report.
SNE has seen similar success with PSNow. Both companies are embracing the subscriber model while trying to offer choice w/ digital, physical, and subs.
Ubisoft is dipping their toes into the water as is Nintendo with using it for their back catalog on NSO. There will be plenty of other companies trying this model in the future.
Console wars are one thing but the profitability concerns are just silly. Especially because it often comes from people without experience in finance like Gamespot. I think the shareholders will be very happy.