Microsoft will share digital revenues with GameStop on every Xbox it sells

Details have emerged about a partnership between Microsoft and GameStop that will see the retailer receive a share of all digital revenues generated by a console sold in their stores.

The agreement has been rumoured, but investment advisor DOMO Capital Management claimed via Twitter that it had received confirmation from GameStop: the chain will get a share of all downstream revenue for customers it brings into the Xbox ecosystem this generation.

Essentially, if a customer has purchased their Xbox Series X or S from any GameStop branch, the retailer will get a share of each digital purchase the user makes, whether its full-game downloads or downloadable content.

DOMO even claims this applies when the DLC is being purchased for a physical base game that was bought at another retailer, providing the DLC is being bought from the Xbox store.

This also extends to pre-owned Xbox Series X and S consoles, with GameStop reporting to Microsoft every unit that it sells.

It's unclear whether a similar arrangement exists with Sony. GamesIndustry.biz has reached out to GameStop for more information.

Earlier this month, GameStop announced a multi-year strategic partnership with Microsoft. While the bulk of the agreement focuses on back-end services, such as cloud-based business applications that will help run the stores, there was a line hinting at this digital revenue share.

"GameStop and Microsoft will both benefit from the customer acquisition and lifetime revenue value of each gamer brought into the Xbox ecosystem," the announcement reads.

It could be a valuable lifeline to the struggling retailer, which has suffered under the shift towards digital distribution and the length of the current console lifecycle. The pandemic has also had an impact on the business.

Last month, it increased the number of stores it planned to close by the end of the fiscal year to between 400 and 450.