@AussieGamr I feel like that’s the risk of mobile games, you’re dealing with way more limited memory and hardware capabilities. That @PlayStation is trying to bring this reality to consoles is despicable
@ShazBoi2003 Sometimes movies just don’t find success at the box office. How many movies become “cult classics,” just because people actually give it a shot after it leaves theaters
@AussieGamr I hope they limit his vocalizations to what he had in 1998. They could still give him personality through the entries which should be limited to what he knows. Meet someone once, you don’t get the full story. Keep going back to the Poe dealer, you learn a little more each time
It sucks for anyone losing their job, but this all sounds very good for @XBOX moving forward. My favorite thing in this, is hearing about the studios that are moving back to being independent with their IP and history intact instead of being shut down. No cancelations
This is an important email I sent today to all employees at XBOX:
Team,
We are beginning the most significant restructure in XBOX history. After careful consideration, I've made the difficult decision to reduce our team by approximately 3,200 throughout FY27. This will include approximately 1,600 role eliminations today, and in addition, four studios will leave XBOX to new management. I recognize that a year-long restructuring creates additional challenges. Unfortunately, it is not possible to make all the necessary changes in a single day, and I wanted to be direct about the scale.
I know this is painful. These changes will directly affect people who have poured their creativity into building XBOX. Many joined us through acquisitions, while others were recruited here, or sought us out because they loved this industry and loved XBOX. Today's decisions do not reflect their talent or dedication.
Our business today is not healthy. We are operating at margins that are 3–10x lower than comparable platform and publishing businesses. We entered Gen 9 with a smaller install base and a higher cost structure. To grow, we bet on Game Pass, multi-platform, and a broader portfolio of content. While those businesses have created meaningful value, they did not grow at the pace we expected. As that happened, our core business weakened, and we added more teams, more investment, and more time, hoping for a better outcome. And now the industry is facing the most severe hardware crisis in its history. We must reset XBOX.
First, we will reset our content portfolio.
Since 2018, we have aggressively expanded our studio portfolio while the number of games created each month across the industry now outpaces the last ten years combined. We now find ourselves competing not only with the largest publishers, but also with smaller independent studios. It is neither possible nor desirable to own every great independent studio. We have also learned that we are not the best home for every type of studio; in a typical year, we lost 64 cents for every dollar we invested. As we reset XBOX, we will help independent creators succeed by providing open development tools and audiences to realize their vision.
Compulsion Games and Double Fine Productions will return to management and transition to independent studios with their IP, catalog, and runway for their next games. Ninja Theory and Undead Labs have entered terms to join new ownership with funding to complete and grow Senua and State of Decay 3. In France, Arkane’s management is beginning required consultation with its Works Council to review potential strategic options.
We are also making reductions across other units, and in some cases, shifting investment to focus on higher priority projects. These changes vary in size across Activision, Bethesda/ZeniMax, Blizzard, King, Mojang, and XBOX Game Studios. None of our first party publicly announced games or projects are being cancelled as part of these reductions.
In addition, Mojang and King will now report directly to me. These two studios have increasingly become platforms and are our largest by monthly active players. They bring critical geographic, demographic, and differentiation to XBOX.
Second, we will reset our platform.
We know that great technology gets better when it gets simpler, not bigger. Today, in some parts of the company, work passes through as many as 14 layers of management. Our platform teams are 40% larger than they were at the start of this generation, even as our player base and playtime have declined. That complexity has slowed decisions, blurred accountability, and made it harder to deliver for players. As we reset XBOX, we will simplify.
We will reduce management layers to no more than 5, and where possible, 3. We will deliver success through a flatter organization that is built around makers (individual contributors focused on building), player-coaches (leaders who remain deeply involved in the work while developing their teams), and directly responsible individuals (DRIs) who own key decisions and outcomes. And we will streamline how we work across our tools, with a cleaner code base, shared services, and 50% reduced vendor spend.
Third, we are resetting how we operate.
As XBOX grew our headcount, we became more fragmented. Teams, studios, and functions often operate independently, and it became harder to work towards a shared goal, make the right tradeoffs, and get things done.
For the first time, we are establishing a Chief Operating Officer with end-to-end P&L responsibility across content, hardware, platform, and services. Helen Chiang has been promoted to this role and will report directly to me. Over nearly two decades at XBOX, Helen has helped build some of our most important businesses, from XBOX Live to leading Mojang and the Minecraft franchise. She will bring our businesses together under one operating model, making sure we make clear investment decisions, learn from our successes and failures, and hold ourselves accountable for results.
Thank you, Dave McCarthy, who is retiring after 17 years with XBOX. Dave has played a defining role in building the platform that millions of players rely on every day and has been a trusted partner through many of the biggest moments in XBOX's history. We wish him all the best.
These changes are about a bigger future for XBOX, not a smaller one. The next decade of gaming will be larger, more global, and more creative than anything we've seen before. This year, we'll invest as much in XBOX as we ever have, but we'll invest with greater focus, greater discipline, and greater clarity, all in service of making XBOX where the world plays and creates.
I want XBOX to be one of the few companies that entertains more than a billion people each day and gives everyone the opportunity to create and connect. I know we can achieve this goal. XBOX has many of the most beloved franchises in entertainment history, talented studios around the world, and we will return to growth in 2027.
History is full of companies that mistake longevity for inevitability. We will not be one of them.
Asha
@AussieGamr Them not holding your hand was no joke. The amount of times Navi would turn green and never explain herself. And there were times it even lead to nowhere, because they couldn’t fit more into the game
@LandiLodge PlayStation dropped that announcement knowing they’d face backlash. They’re hoping everything just smooths over.
Who would’ve thought inside of 12 months people would be rethinking their opinions on the Nintendo game code cards
I have two younger brothers. We liked different games. We always had a Madden franchise. If we Skyrim, Red Dead Redemption, Fable II, NHL all on the console at the same time, storage was an issue. And that was just for save files and updates for the disc version of the games
An argument against digital only purchases for games that I’m surprised I don’t see more is storage. Games are getting bigger and bigger. I know the storage is too, but if you buy the base level of a console, you typically can’t have more than a couple big games on it
@kingtrousers@asha_shar I think Xbox is gonna waste a good opportunity here. If 15% of PlayStation sales were in physical copies of games, assume not everyone makes the move. But if they can convert even 5% of those sales to Xbox sales, that’s a huge bump in revenue
Is @PlayStation’s news today the new 3.5mm jack? Are they going to take the backlash short term like Apple did, but if Microsoft and Nintendo soon follow suit, everyone just quietly moves on?
@kingtrousers@asha_shar@PlayStation@XBOX has a huge opportunity here if they can commit to keeping physical copies of games available for the next gen. I think they’ve been making a push towards all digital as well though
I have mixed feelings here. I’ve shifted to PC gaming primarily and basically everything on PC is through Steam. However, whenever I buy console games, it’s always physical. For a number of reasons.
There’s also something to opening up a new video game for the first time
Important updates:
News on physical discs for new games - https://t.co/BzZODXdWGY
News on PlayStation Store on PS3 and PS Vita - https://t.co/ev3mN6wj14
@TheJetPress Oh yes. Mougey, what a clown trading for Smith. How in MARCH, when he made the trade, could he not know about these allegations against Geno that occurred in JUNE? Crystal ball busted? Credit to Seth Walder for holding him accountable
People just love punching down on the Jets
@NintyPrime This is exactly it. I haven’t played it, but I played the N64 version and to put it into terms for people that never played arcade games, it’s more like a roguelike. You get through the game. Then try it again but differently or try to do it quicker. That’s intentional design
@GameFly I’ve never used you guys, but I love seeing this about 3 tweets down from “PlayStation is deleting 500 movies that users paid for because a licensing agreement expired”
@LandiLodge Do you think they’re planning DLC for the game? Was this Nintendo testing the viability of a completely new Starfox game that builds on the story in this game? Do you want them to expand on the story in a future game or DLC?
@LandiLodge I had to jump off last night for dad duties. But I caught the end on replay today. Got a few questions based about your experience.
I’ve seen a few complaints that the story is so short. Doesn’t seem like that’s a complaint of yours