Marvel fans are celebrating the latest X-Men casting rumors, which suggest that Star Wars sequel trilogy standout Adam Driver will play a new incarnation of Magneto. https://t.co/NbDJBd2UjA
Past business decisions and the current state of the industry led us here. Some of this news sucks, but I hope we see XBOX come back stronger on the flip side.
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
@vicious696 Parris, I love you, man, but what happened to the positivity peddler?? I get that some things suck right now, but if any community knows how to adapt to the industry it surrounds it’s our community of gamers. Keep your chin up and keep up the good work.
@CrReaM Fuck that guy, man. Any fan that doesn’t recognize that you have a life outside of streaming isn’t a real fan. Take care of your family. They come first 100% of the time and the real fans understand that.
@SaffronOlive Number One for me is Elder Scrolls. It would be such a great fit. Plus we already have gotten Fallout, so that relationship with Microsoft/Bethesda is there too.
🟢 Asha Sharma in 3 months -
✅ Brings back EXCLUSIVES
✅ Kills co-pilot
✅ New Xbox logo
✅ Cut GamePass price
✅ Kills “This is an Xbox” ad
✅ Makes console core
✅ Updates Achievements
✅ Adds Gamer Badges
✅ Announce Project Helix
✅ Re-launch fan fest
✅ Adds fan feedback
@DestinLegarie I think it makes sense. The gods we saw, Sekhmet and Begtse are both Gods of War in their respective mythologies. I imagine we will see more as well.
IOI needs to start working on the next 007 game ASAP. That game is incredible and my current game of the year. Patrick Gibson was amazing in this role and I can’t wait to see what else he does.
I’m trying so hard to not get excited about this in case it gets canceled for some reason, but this right here is my dream game. They also shouldn’t have said anything because this is probably more like 5-6 years out still.
You might have heard the rumours, it's time to reveal what we are working on.
🗺��� An open world Middle-earth RPG.
⚔️ A new Kingdom Come adventure.
We’re excited to tell you more when the time is right.
#WarhorseStudios #Annoucement #lotr #KingdomComeDeliverance
This worries me, because we know from the books that Sméagol was never a good person. He was a conniving sneak and a thief even before The Ring came into his life. The Ring just accentuated that part of him which ended in his exile to the Misty Mountains.
You wanna know how I got these scars, Precious?
Peter Jackson compared The Lord of the Rings: The Hunt for Gollum to Joaquin Phoenix’s Joker, saying the movie will “get inside” the character’s head and tell the story from an internal perspective. https://t.co/PzgrHgs6o1
@KahliefAdams@The_WalkinDude_ I think that’s fair. My thought process is that we have no proof that she has or hasn’t tried to stop him. I tend to assume the former based on my past experience, but I can see how it’s easy to think the former given how long he’s been doing this. Thanks, Kah! I appreciate you!
@KahliefAdams@The_WalkinDude_ Why not, man? His wife and child haven’t done anything wrong. Hell, as far as we know his wife and child are victims in this too. I’ve followed you for a long time and always had the sense that you’re a good guy and I still believe that. We should have some level of compassion.
LEGO has revealed its Lord of the Rings Minas Tirith city set
It will cost $649.99, includes 8,278 pieces, and is the sixth-largest LEGO set ever by piece count
This is it! I have had such a hard time figuring out why I didn’t like Mixtape and I think this sums up exactly why I wasn’t a fan of this game. Just as a note DEVO and Smashing Pumpkins aren’t “metal” either.
@MikeDrucker I’m right with you, Mike. It just didn’t connect with me. I think the nostalgia strings it’s trying to pull just aren’t mine. I appreciate the art style, but I didn’t really find myself caring about the characters and didn’t really enjoy the gameplay much.