Back when Microsoft acquired Bethesda, our first thought was, 'I wonder if this will be bad,' but our second thought was, 'Ooh, maybe now Obsidian will make Fallout: New Vegas 2.' And when the Fallout TV show turned out to be a hit, we scratched our heads over the continued absence of a new Fallout game.

Now it looks like a new Obsidian-made Fallout RPG may actually happen. Word on the street is that Microsoft has put Obsidian's Josh Sawyer—who directed Fallout: New Vegas—at the helm of a new Fallout game as part of the "Xbox reset" shakeup, which will see 3,200 people lose their jobs.

The situation is "still in flux," according to the Bloomberg report that broke the news, and could change. But supposing that Obsidian and Sawyer do dive into this project, are you excited? There's a poll below, and the comments are open.

I'm feeling ambivalent. I like Obsidian and Sawyer, and a new Fallout game seems like a perfectly good pursuit for the developer and director, and a good thing for fans of the series who've been asking for just this for years.

But the news comes alongside thousands of layoffs across Xbox, including a substantial number at Obsidian itself, which has reportedly cancelled an Avowed sequel and other projects to make way for Fallout. It's not exactly an auspicious way to kick off a new project, and it's hard to sustain feelings I'd describe as positive after a bunch of people were just put out of work.

A Bloomberg report says Obsidian Entertainment, which was recently hit hard by mass layoffs at Xbox, has cancelled projects including a sequel to Avowed and will instead begin working on a new Fallout game.

The plans are "in flux" and could change, according to the report.

A California WARN report shared by GameFile says 52 employees at Obsidian were let go in the layoffs, which Bloomberg says represents roughly a quarter of the studio's workforce. The sequel to Avowed, the outstanding 2025 first-person RPG set in the studio's Pillars of Eternity universe, is one of multiple unannounced games in development that have been cancelled amidst the bloodletting.

Instead of that, a new Fallout game is reportedly being headed up by Obsidian design director Josh Sawyer. Sawyer has an enviable record of RPG credits to his name, most notably in this moment as the lead designer and director of Fallout: New Vegas.

Still, I'll be the first to say it, in this story at least: This sucks. I'm as down for a new Fallout as much as the next guy, but I could also really go for more Pillars, or whatever non-Fallout RPG Sawyer was reportedly directing before his attention was diverted to this.

I also can't help wondering how the circumstances will impact what ultimately comes out of this. Sawyer has previously said he'd head up a new Fallout game if Microsoft asked, if he could do it on his own terms, but I doubt his terms would ever have included seeing a quarter of the studio put out of work, or that the mood among those who remain is going to contribute positively to the project.

I've reached out to Obsidian for comment on the report and will update if I receive a reply. In the meantime, if you want to see what Sawyer and Obsidian can do when they don't have shareholder-obsessed overlords breathing down their necks, I would urge you to check out Pentiment, an astonishingly good slow-burn journey through 16th century Bavaria. It's currently on sale for $10/£7.49/€10—that's half-price—in the Steam Summer Sale. (Also, a bit of advice: Don't spoil it for yourself.)

If you've played a new Elder Scrolls game anytime since 2002, you've seen Christiane Meister's work: The senior character artist spent 27 years at Bethesda, contributing to games from Morrowind to Skyrim. As of this week's round of Xbox layoffs, however, her tenure is over.

The news came to my attention via a post by Lady Nerevar on Bluesky, though I double-checked Meister's LinkedIn and, sure enough, she is currently looking for work: "I was in charge of design, creation, and management of character art assets throughout all of the Elder Scrolls projects, starting with Morrowind to our latest title, Skyrim.

"This included drawing concepts and seeing the art piece through to the final stage of getting the object in the game as well as handing off concepts to other artists in the character group. I also oversaw outsourced assets from design to final in-game models."

As for her role in Skyrim, Bethesda still (bitterly) has a 'meet the artist' blog from 2022, wherein Meister talks a little bit about how she gave the khajiit and argonians a facelift between Oblivion and Skyrim:

"The beast races have always been a challenge, technically. In Oblivion, we went the route of everyone having the same face and using FaceGen to morph that face into the beast races. That was a… look. In Skyrim, I just [made] the faces how I wanted and then provided them with their own facial features to change. This looked much better! The only thing that it required was that we make separate helmets to fit their heads."

To me, it speaks to the depths of Xbox's cuts that such an incredibly crucial part of The Elder Scroll's visual identity has been let go. As some have pointed out, Asha Sharma, the current CEO of Xbox (who bravely claimed she'd steer the company towards an improbable 1 billion daily players), would have been either nine or 10 years old when Meister started working at Bethesda for the first time.

If you were to be a ruthless capitalist about it, you could argue that long tenures in game development lead to higher salaries—which'll often be the first in the crosshairs when layoffs inevitably come calling. The 'if' there is important, though, as I cannot think of a single situation in which booting someone with this much experience and expertise is the right move.

It's no wonder the industry writ large is spooked. There's no real world in which any of these layoffs and studio closures are a sign of good health—especially given the industry isn't exactly poor, right now. Global games revenue surpassed $200 billion in 2025; the money is there, it just seems to belong to the shareholders, and not the people who've been making games for nearly three decades.

Yesterday's layoffs at Xbox took, and will continue to take, a terrible toll. Some trumpeted the fact that no studios were closed, although the practical impact of spinning them out to independence or new ownership remains to be seen, but that has no bearing on the blow to morale caused by such deep cuts to long-standing dev teams.

One former Elder Scrolls Online developer put words to those feelings in a short, poignant thread on X, lamenting the state of the game and developer ZeniMax Online Studios, which was reportedly purged of half its employees in the layoffs.

"I’m just so angry today," wrote Andrew Young, a content designer on Elder Scrolls Online who worked at ZeniMax Online Studios from 2012-2024. "People will never know the blood, sweat, and tears that went into making ESO or how we basically funded other failing projects while never getting enough resources to really keep up with our release cadence. The team deserved much better."

The Elder Scrolls Online has had a tough go of it over the years. Its launch in 2014 did not make a great impression, and while the shift to Tamriel Unlimited a year later turned things around, it always felt to me a bit like an afterthought MMO: The second cousin to World of Warcraft and Final Fantasy 14 whose face you recognize in photos, but whose name you can't quite put your finger on.

But things seemed to take a darker turn in 2025. Just a year after a GDC talk extolling the actually-quite-remarkable success of TESO, game director Matt Firor—also the president of ZeniMax Online Studios—suddenly left the studio, a move he later said was the direct result of Microsoft's 2025 bloodbath layoffs that also saw the cancellation of a new ZeniMax Online MMO known as Project Blackbird.

That Microsoft saw fit to cut even deeper into the studio just a year after that has some concerned about its future. Following the layoff announcement, TESO community manager Jessica Folsom reaffirmed the dev team's commitment to the game but added that previously announced roadmaps for the new seasonal structure "will be shifting." There's no indication of anything more serious in the offing but I can't help thinking of Amazon's New World, a moderately successful MMO that was nonetheless canned when Amazon decided that its own "go big" strategy for gaming wasn't working.

"I've been gone for a while, but talking to people today and realizing there's really no one left and no changing it now makes my heart ache," Young concluded. "For the people, our game, who we were as a team and a studio. This is a serious loss, and I don’t think people know how much."

US senator Bernie Sanders is famous as not-exactly-a-friend of powerful corporations: He's previously called for OpenAI to be broken up, for instance, and earlier this year announced a bill that would pause the construction of data centers in the US, to give lawmakers a chance to catch up with, and regulate, AI companies.

But AI isn't Sanders' only PC-centric bugaboo: He's also pretty pissed off about the Xbox situation.

"Last year, Microsoft made $101 billion in profits, got a $12.5 billion tax break from Trump and paid its CEO $96 million," Sanders blasted out on X, not long after the announcement of sweeping layoffs at Xbox.

"This year, it’s raising the price of an Xbox by $150 and eliminating 3,200 jobs. Please don’t tell me corporate tax breaks create jobs. It never trickles down."

The concern is clearly more about the deeply unfair and unhealthy oligarchy we're living in, and not how much Sanders has to pay for the next Xbox, but I find it interesting that the relatively mundane dealings of a game company are enough to attract the attention of such a high-profile politician.

Of course, this isn't ol' Bernardo's first bit of Xbox-related criticism: In 2022, he joined with fellow senators Elizabeth Warren, Cory Booker, and Sheldon Whitehouse in calling out Bobby Kotick's golden parachute following Activision Blizzard's acquisition by Microsoft.

That, sadly, might lead to a certain amount of cynicism about what Sanders and other lawmakers can actually do here, aside from posting about it. The US Federal Trade Commission actively opposed Activision Blizzard's buyout, but its efforts to halt the deal, or even just pause it while legal challenges worked their way through the system, were repeatedly thwarted. Former FTC chair Lina Khan, who headed up the agency during the acquisition, pointed out in 2025 that Microsoft's actions since the merger are pretty much exactly what she tried to warn everyone about.

Xbox CEO Asha Sharma has made a number of big changes since taking over from former chief Phil Spencer. Some of them—dialling back Game Pass, leaning into exclusives—collectively represent a pretty clear repudiation of Xbox's choices under Spencer. In a new interview with Fortune (via Game Developer), Sharma said that Xbox spread itself too thin under its previous strategy.

"In order to grow, we made a bunch of bets ... and as we did that, we inherently didn’t focus on the core business," Sharma said. "The number one measure of your strategy is what you put your resources behind, and we simply spread ourselves too thin."

The Fortune interview was published on the same day that Sharma announced 3,200 layoffs at Xbox, and the spinoff of four of its studios.

Sharma also returned to one of her key points in that layoff announcement: That the Xbox business is not "healthy."

"A healthy Xbox could weather the shock of the hardware crisis," Sharma said in the interview. "With an unhealthy Xbox, it becomes really challenging, and it accelerates a lot of the changes we need to make."

The reference to "health" presumably means that, with better profit margins, Xbox would be able to better absorb the hit of the rampocalypse (that Microsoft, ironically, is helping make happen) because it would have more flexibility when responding to price hikes: Profits might go down in order to keep retail prices palatable, but there's more room for them to shrink without actually causing losses.

Regardless of the "health" of the Xbox, component prices are astronomically high and likely to get worse, and that impacts everyone. Materials costs alone for the next PlayStation console are currently estimated to exceed $900, and the cheapest Steam Machine you can buy is $1,049.

That's an enormous amount of money for a game console. True Xbox optimists might imagine that Microsoft could use those wider profit margins Sharma aspires to in order to bring prices down to a less eye-watering level, and sure, it could. I wouldn't hold my breath.

Sharma said Xbox executives are also experimenting with new business models, such as "buy now, pay later" financing program, which will nominally reduce the barrier to entry but—speaking as someone with a bit of experience in the retail electronics field—may also leave customers who don't read the fine print and sufficiently mind their money burdened with far heavier debt than they expected.

However it shakes out, Sharma said the process is going to take time, and hinted at the possibility of more unpleasantness ahead: "I think our core has to be healthy, and that will be necessary but not sufficient."

The latest mass layoff at Xbox will see roughly 3,200 people lose their jobs—1,600 today, and 1,600 more over the next fiscal year—and four game studios turned loose into the forest: Compulsion and Double Fine as independents, Ninja Theory and Undead Labs under new ownership. It's bad no matter how you look at it, a reflection of flailing leadership at Microsoft and a dreadful state of affairs for the game industry as a whole.

The bloodletting has inspired a range of reactions across the internet—and yes, there is a small subset of the gaming population celebrating what it sees as a victory of 'real gamers' over some imaginary ideology that holds too many game studios in its grasp.

For the most part, though, the responses are shocked, sorrowful, angry, and even among those who insist these cuts were necessary, filled with regret.

Griffin DeClaire, who was laid off from Bethesda Game Studios today, said the cut came as a complete surprise because he was just told he'd be getting a raise. "I really don't know what my next steps are," DeClaire wrote on LinkedIn.

Arkane founder Raphael Colantonio, who left the company in 2017 and now heads up WolfEye Studios, embraced a bit of dark humor in response to Sharma's statement:

We initially thought that Obsidian, which isn't mentioned in Sharma's announcement, had escaped the axe, but that later proved to be false: Narrative lead Kate Dollarhyde said on Bluesky that the studio "lost many excellent developers and wonderful people" in the layoffs.

Among those let go was Daniel Alpert, who joined the studio in 2005—just two years after it was founded—and most recently served as art director on The Outer Worlds games.

Alpert said he was grateful for having spent more than two decades at Obsidian but added, "We are clearly at a turning point in the games industry. These past months have been difficult for so many talented people, and unfortunately, it seems the challenges aren't over yet."

Larian's publishing head Michael Douse was as surprised as any of us to discover that through all these years, Xbox did not have a chief operating officer.

Gloomwood developer Dillon Rogers pointed out the incongruity between Sharma's stated commitment to Bethesda's biggest franchises, and gutting the studios that make them:

Mike Kern, who was laid off after nearly 14 years at ZeniMax Online Studios, noted the obvious difficulty that many in his position don't talk about publicly: The videogame industry simply cannot reabsorb all these people. Talent is going to be lost on a massive scale.

Dan Callan, a former designer who was let go amidst last week's layoffs at that company, reflected on the deep and inescapable shittiness of pre-announcing 1,600 layoffs that will happen over the next fiscal year.

This was the best part about the last year of Bungie, through multiple layoff cycles it was a daily battle between survivor’s guilt and waiting for the other shoe to dropI would reiterate people will not make a good video game under these conditions but that assumes any of these ghouls care

— @danjamin.bsky.social (@danjamin.bsky.social.bsky.social) 2026-07-06T22:08:18.292Z

Jason Schreier of Bloomberg shared the same sentiment, saying that Blizzard employees are being left hanging until further notice.

Case in point: the staff of Blizzard Entertainment were told today that they won't hear how the reorganization impacts them until "further communications"

— @jasonschreier.bsky.social (@jasonschreier.bsky.social.bsky.social) 2026-07-06T22:08:18.063Z

Others pointed out that the cuts come as Microsoft continues to pour billions of dollars into a pursuit of AI that seems to be growing increasingly desperate, including notable AI industry critic Ed Zitron, who had some harsh words for all involved:

This sounds insane until you remember that Microsoft is ALL IN on Ai. These folks believe most of us will be out of work in the next 5 years, drawing from UBI. What will we do with all that time? XBox hopes we'll spend our time & money with them. Dystopian thinking.www.pcgamer.com/gaming-indus...

— @crobertcargill.bsky.social (@crobertcargill.bsky.social.bsky.social) 2026-07-06T22:08:18.814Z

Sure Microsoft may have fired thousands of people and gutted its games division but at least it had more money to pour into Copilot, the 4th most popular AI, a product nobody wants or likes except rich executives, that is constantly losing horrendous amounts of money

— @oldpappythomas.bsky.social (@oldpappythomas.bsky.social.bsky.social) 2026-07-06T22:08:18.503Z

But AI-focused employees aren't immune: Kevin Flynn, a commerce growth and AI product manager who said he'd increased "PM AI adoption from 12% to 91% in 3 months by building a PM specific AI harness," revealed on LinkedIn that he'd been let go.

"The last four years have been brutal in the industry," Epic Games lead level designer Scott Maclean said in his own post about the layoffs. " I’ve not seen anything like this in my 25 year career. I keep expecting it to normalize, to balance out, but that seems to not be the case."

Keith D. Boney, a former user researcher at Bethesda whose entire team was impacted by today's layoffs, shared a similar thought, writing that "this recurring trend in the Games industry is one that is extremely detrimental to psychological safety, let alone fiscal stability."

There's more, of course, but the inherent absurdity of supposedly serious executives talking nonsense about entertaining "more than a billion people each day," which PC Gamer's Harvey Randall aptly described as "delusional," has a way of making it all feel a bit futile.

Layoffs like this, which have become par for the course since Microsoft swallowed up Activision Blizzard in 2024, are outrageous and heartbreaking, and there has to be a better way. But as we careen from "never looked stronger" to "our business today is not healthy" over the course of a single year—both of them resulting in layoffs—I find myself wondering if we're ever going to find it, or if we're just going to keep howling into the social media void until there's nothing left.

Original story: Curiously absent from today's mass layoff announcement at Microsoft was legendary RPG studio Obsidian Entertainment, which thus far had navigated Xbox's 2020s layoff waves unscathed. Not anymore: An indeterminate number of developers has been laid off from the company, according to social media posts from current and former employees. I have reached out to Obsidian for comment, and will update this story if I hear back.

Rebs Gaming on Twitter documented four developers who shared their own experiences on LinkedIn, and I was shocked to see artist Daniel Alpert among those laid off. Alpert has been with the company for 21 years, with credits on Neverwinter Nights 2, Fallout: New Vegas' DLC, Alpha Protocol, and most recently The Outer Worlds 2. On the opposite end of the spectrum, engineer Wenzheng Huang had only just started at the company in May.

In addition to Huang, Alpert, area designer Tyler McCombs, and communications producer Geoffrey Fogle, writer Jay Turner has shared that he was laid off from Obsidian. Turner's only credit with Obsidian was Avowed, but his industry experience stretches back to the golden age of BioWare: Turner is credited on Jade Empire, Dragon Age: Origins, Mass Effect 2, and many more games.

Pentiment artist Soojin Paek, Avowed narrative designers A.K. Fedeau and Katie Tenney, as well as Avowed area designer Bre Seale also number among those affected by today's layoffs. That brings the total count to nine at the time of writing. Both Turner and Obsidian narrative lead Kate Dollarhyde (who remains at the company) characterize the layoffs as significant in scope.

As a company of over 100 employees (285 in 2025), Obsidian is obligated by the WARN Act to provide advance notice of layoffs in excess of 50 employees. The California WARN Act Tracker does not show Obsidian as having reported its layoffs. This would have put today's count at between nine and 49 people, though Kotaku reports that the final count is 60-70 employees laid off.

Numerically a drop in the bucket compared to the 1,600 laid off across the entirety of Xbox, with 1,600 more in the next 12 months, but every one of those figures is a life that's been upturned. What's more, Obsidian is a legendary RPG studio, one with four games in our 2025 Top 100 list (Pentiment, Knights of the Old Republic 2, Deadfire, and New Vegas). In recent years, the studio has gone from strength to strength with the heartbreaking Pentiment, breakout Grounded series, as well as the criminally underrated Avowed and Outer Worlds 2.

Obsidian followed Xbox's presumed previous mandate, to release a high volume of quality games to support Game Pass, to a T, pushing a pace largely unheard of in the modern industry: Five games in five years, from 2020 to 2025. Its developers have been punished in spite of that success.

With Xbox floundering and 1,600 more layoffs expected at the gaming division in the next 12 months, I've never been less secure in Obsidian's future⁠—and let me tell you, I'm rooting for its 100-year plan. Obsidian reached its 25th anniversary despite almost going under multiple times in its history.

It would be criminal to lose the studio in the coming years because Xbox was not profitable enough, and Satya Nadella needs to fish more change out of the couch cushions to throw at AI datacenters and Copilot, the fourth most popular chatbot that lies to you.

Today's Xbox layoffs may have hit Bethesda and ZeniMax particularly hard, as reports of "significant" cuts have begun to surface and the Bethesda Game Workers Union says that "many" employees at Bethesda Game Studios have been let go.

Today's announcement of major layoffs at Xbox and the spinoff of four studios—Compulsion Games, Double Fine, Ninja Theory, and Undead Labs—also included word from CEO Asha Sharma that company is "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."

Details on studio-specific cuts haven't been announced, but Bloomberg's Jason Schreier said on Bluesky that ZeniMax Media, the parent of id Software, Bethesda Softworks, ZeniMax Online Studios, and others, "will be impacted significantly by the reorganization," although he added that Bethesda will not be pared down to just Fallout and The Elder Scrolls teams, as some reports have claimed: "The publisher will also still work on Wolfenstein, Doom and Quake."

But some of the studios responsible for those games are also reportedly being hit hard: "Studios in the Bethesda organization like id Software (Doom) and ZeniMax Online Studios (Elder Scrolls Online) are not shutting down but are cutting a significant number of staff this morning, per sources," Schreier added in a subsequent post.

A separate statement from the Bethesda Game Workers Union, the "wall to wall" union that formed in 2024, also indicated that the cuts run deep.

In what is becoming a stressful annual routine, Microsoft has decided to lay off thousands, including MANY of us at Bethesda Games Studios. With over 10k developers already cut from previous rounds, those at the top have deemed that insufficient in fixing their mistakes.

— @bethesdaunion.bsky.social (@bethesdaunion.bsky.social.bsky.social) 2026-07-06T16:29:42.450Z

"In what is becoming a stressful annual routine, Microsoft has decided to lay off thousands, including MANY of us at Bethesda Games Studios," the union wrote on Bluesky. "With over 10k developers already cut from previous rounds, those at the top have deemed that insufficient in fixing their mistakes.

"Today we say goodbye to many of our friends and colleagues and to hundreds more across Xbox, including folks that have worked at Bethesda Games Studios for decades. When will this cycle of cuts in pursuit of ever-greater profits end?"

I've reached out to Bethesda and the Bethesda Game Workers Union for more information and will update if I receive a reply.

In today's announcement of a staggering 3,200 layoffs at Xbox, the fate of one fan (and PC Gamer) favorite studio was left up in the air. Arkane Lyon, the remaining half of the modern immersive sim maestros, appears to be entering negotiations for an indie exit similar to other former Xbox studios.

"In France, Arkane's management is beginning required consultation with its Works Council to review potential strategic options," Xbox CEO Asha Sharma wrote in her missive on the mass layoffs. Former Kotaku editor Stephen Totilo has more context in his newsletter, Game File.

According to Totilo, Arkane is "also slated for an exit" similar to Double Fine, Undead Labs, Compulsion Games, and Ninja Theory. "Given local laws, though, Microsoft has been unable to explore its future—ranging from sale, to management buyout to shutdown—until today," Totilo wrote. "The fate of the Blade game is contingent on the studio’s future."

On Bluesky, Totilo wrote that Arkane's negotiations with Microsoft could lead to "100+" layoffs at the studio, depending on what form its future takes. Similar to the UK, which mandates a month-long redundancy process in the event of layoffs, muscular French labor laws prevent the sort of abrupt, day-and-date layoffs we're used to seeing in the United States.

You can see the contrast most clearly with the fate of Arkane Lyon's dearly-departed, Texas-based twin. Arkane Austin was shut down by Microsoft in 2024, one of the first casualties of Xbox's ongoing disintegration.

Arkane Lyon's most recent game was 2021's Deathloop, the excellent Groundhog Day time loop immersive sim. Arkane announced an adaptation of Marvel's Blade in the summer of 2023, and we've heard little since⁠—though Blade has consistently remained one of our most-wanted games.

Previously, Arkane Lyon developed our 2016 game of the year, Dishonored 2, and Arkane Lyon level designer Romain Barrilliot was lead designer of Thief: The Black Parade, ModDB's 2023 mod of the year and a modern triumph of the immersive sim genre.

As for those affected, I've only seen a telling non-comment from Arkane level design director, author, and Through The Looking Glass forum co-founder Dana Nightingale. "All I know is I'm really excited for everyone to read and love my upcoming book," she wrote.

Arkane founder Raphael Colantonio, who left to start Weird West developer WolfEye Studios, had a cheeky response to Asha Sharma's layoff announcement post on Twitter: "Regarding Arkane… how much? I’m asking for a friend." Colantonio was likely joking, but stranger things have happened, and I think we're all waiting on a hero here.

You can imagine the golden path: Minimal layoffs and an independent Arkane, or maybe ownership by an eccentric-yet-benevolent French billionaire who loves immersive sims. But that's far from certain, and like many immsim fans, I'll be contributing spirit bomb energy in hopes of a happy outcome. All I know is that Arkane has a design pedigree stretching all the way back to Origin Systems and Looking Glass Studios in the early '90s, and it would be a tragedy to have that ended by feckless corporate spreadsheet thinking.

The time has finally come for Xbox's massive reset—in a statement on the official Xbox site today, recently-minted CEO Asha Sharma revealed the fate of several studios. I won't be focusing on them in this article (although you can read the words of my fellow PCG writer Andy Chalk first, if you'd like).

Instead I want to highlight (with the deserved scrutiny of a post announcing the threatened livelihoods of thousands and people) Sharma's closing paragraph, because it's borderline delusional.

"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."

A billion, need I remind you, is a thousand million—to give you a sense of scale, a million seconds is 11.5 days. A billion seconds is 31.7 years. A grain of sand is around 0.4mm in diameter. If you made a chain of them, a million grains would get you 0.2 miles, a distance you can walk in about five minutes. A billion grains would get you 248.5 miles, which'd get me, in the UK's south, halfway up to the top of Scotland.

Or, hell—let's talk about videogame subscribers as a metric. World of Warcraft, a videogame Microsoft currently owns, hit a peak of 12 million subscribers during Cataclysm. 12 million players, the absolute highest point of one of the most popular MMORPGs ever created, the literal biggest fish in the genre? That is 1.2% of a billion.

And we're just talking about subscribers, not daily players. Sharma wants a daily playerbase that is the equivalent of 83 World of Warcrafts at their highest peak, all logged in at the same time. Counter-Strike, the most popular game on Steam, had an all-time peak of 1.8 million. She wants 555 Counter-Strikes every day.

Speaking of Steam, the platform hit 41 million concurrent users last year. Sharma wants 24 Steams at their all-time record heights. 24 of them. Even if we're a bit more charitable and assume that, say, Steam hitting a peak of 41 million means 60 million players logged into it on that day. That's still 16 Steams.

It's a quite frankly delusional figure that's nonetheless a perfect encapsulation of the runaway irresponsibility of Microsoft in the past few years. Multiple promising studios shut down, huge acquisitions, rampant AI spending—all of which, you might think, would make the executive class wonder if they were maybe aiming a little too high.

But not Sharma, no no no. We must entertain a billion people each day, she bravely shouts, we must be 24 Steams, and we can be 24 Steams.

And, naturally, we must do so by demanding that fewer people do more work. Sharma says she wants all of this with the same breath in which she announces Xbox will have 3,200 fewer people working for it by 2027.

The quite frankly insulting final paragraph of Sharma's corporate diatribe is an example of the exact plague that's boiling the videogame industry alive. There is no room for humility or self-reflection. Sharma must promise the mathematically impossible to save face, or, I can only assume, violate some arcane dogma and burst into flames. Microsoft's year of shame is getting a sequel.

Today, Xbox announced what it calls "the most significant restructure in Xbox history": Part of a larger downsizing at Microsoft that's putting 4,800 employees out of work, the reorganization will eliminate 1,600 Xbox roles today, with the division aiming to reduce its headcount by 3,200 throughout the 2027 financial year.

Alongside the layoffs, four game development studios are leaving Microsoft ownership for new management, including South of Midnight and We Happy Few developer Compulsion Games. Previously reported as facing imminent closure, the award-winning Montreal-based developer is instead returning to independent studio status and maintaining ownership of its IP and games catalog.

An important update from Compulsion Games.

— @compulsiongames.bsky.social (@compulsiongames.bsky.social.bsky.social) 2026-07-06T15:50:11.169Z

"Today, we're sharing that Compulsion Games will return to independent management following our time as part of Xbox. As part of this transition, we will retain the rights to Contrast, We Happy Few, and our award-winning South of Midnight," Compulsion Games said in a statement on Bluesky. "We're grateful for the years we spent with Xbox, for the support they provided our team, and for the opportunity to bring these games to players around the world."

While the studio says it's "excited to continue building the distinctive games that define Compulsion," its first steps with its newly-regained independence will be focused on its staff.

"Our immediate priority is to support our team throughout this transition period," Compulsion said.

Last month, reports suggested that Xbox's looming reorganization has placed Compulsion at imminent risk of closure—a suggestion made more credible by Compulsion employees who had posted on LinkedIn and other platforms indicating they were seeking work. The status of those employees, and whether Compulsion can be expected to make further cuts to account for the financial pressures of transitioning to independent management, is currently unclear.

"We are confident in the future of Compulsion Games and look forward to this next chapter where one thing will remain constant: We will create unique games that tell important stories, all with the goal of touching the hearts and minds of our players."

The axe has fallen on Xbox, which announced another major round of layoffs that will see approximately 3,200 people put out of work, with 1,600 losing their jobs today and another 1,600 to follow over the course of the company's fiscal year. Four studios—Compulsion Games, Double Fine, Ninja Theory, and Undead Labs—will also "leave Xbox to new management," as CEO Asha Sharma put it.

None of those studios will close as a result of today's cuts, which is the only upside to the whole thing: Compulsion and Double Fine will go independent again, "with their IP, catalog, and runway for their next games," Sharma said, while Ninja Theory and Undead Labs are being sold to unnamed new owners.

The situation may be grimmer for Arkane, where "management is beginning required consultation with its Works Council to review potential strategic options." Further details aren't provided but in France, where Arkane is based, and other EU nations, employee consultations are a mandatory part of the layoff process. There's no mention of the Blade game Arkane is currently working on.

Xbox is also "making reductions across other units," including Activision, Bethesda/ZeniMax, Blizzard, King, Mojang, and Xbox Game Studios, although Sharma said no ongoing projects will be cancelled. Minecraft studio Mojang and the mobile studio King will also now report directly to Sharma.

Sharma declared that "our business today is not healthy" as a prelude to the cuts, a statement made almost exactly one year after her predecessor, Phil Spencer, declared that "our platform, hardware, and game roadmap have never looked stronger" as he imposed mass layoffs of his own in 2025. Sharma also repudiated Spencer's all-in bet on Game Pass and multi-platform releases, saying that while they "created meaningful value, they did not grow at the pace we expected."

I like handheld gaming PCs. Note that I've carefully used the word "like," rather than love. In all honesty, I wish they were faster. Or more portable. Concessions need to be made if you want to play demanding games on the go, it's true. But, in recent months, it's the price that's really put the tin lid on the whole handheld gaming affair for me.

The Lenovo Legion Go S SteamOS, a handheld we fell in love with last year at its $830 MSRP, is now listed for $1,332. Or how about the MSI Claw 8 AI+, a mega handheld I personally gave a 90% score to (while admitting it was rather expensive) at $900? Now you'll be lucky to find one for under $1,200. Its recently-announced, Panther Lake-powered successor? That'll rack you up $1,799 at pre-order prices.

I know, I know. It's another article from me complaining about pricing, and I realise I probably sound like a stuck record. But I cannot think of a PC gaming hardware category more screwed by the memory crisis than the handheld market right now. I update our handheld gaming PC deals every week, and recently I had to make an admission:

The Asus ROG Ally Xbox X, a machine we rightly criticised for having a "super-high price tag" on its release just eight months ago, is now what I'd call the best value proposition on the market. For one thousand smackeroonies. A cool grand. Serious cash.

That's the price of a budget, yet soul-affirming, weeklong beachside holiday for two. And yet, if I were to recommend you buy any gaming handheld under today's ridiculous pricing conditions, it'd be this one.

It's properly fast, for a start. With an AMD Ryzen Z2 Extreme APU furnished with RDNA 3.5 graphics tech and 24 GB of LPDDR5x-8000, it's got a specs sheet that allows it to monster pretty much every other handheld we've ever tested.

You get a 1 TB SSD as well, which should allow room for plenty of modern games. There's also the ROG Xbox Ally (non-X) to consider at $600, but the Ryzen Z2 A chip at its core feels a little underpowered—although it's still worth some thought at that price.

Compare and contrast either with the Steam Deck OLED, which now runs you $949 for the 1 TB model. Sure, it's got a nicer screen. But the now-aging internals simply don't make any sense for this sort of money. A bit like the Steam Machine, now I come to think of it—although I digress.

Plus, the ROG Xbox Ally X's Windows Xbox full screen experience (what a horrible mash-up of terms) is pretty darn good. It's no SteamOS, but it's nevertheless a pretty seamless way of interacting with the system via the medium of thumbsticks. And Steam's Big Picture Mode is still an option for sorting through your games library, of course.

It's quiet, comfortable, and—again I can't believe I'm saying this—reasonably priced given what you receive compared to the competition. Somehow, the Xbox handheld has managed to place itself within the market at the right price, at almost the right time.

Which makes me wonder how much longer it'll be before that MSRP jumps. Given the state of *gestures wildly* everything else in the consumer electronics industry right now, I'd imagine that within the next few months, this column will become defunct.

I'm kind of astonished that the ROG Xbox Ally X is still sitting at its $1,000 MSRP as we speak, and something deep in my bones tells me that won't be the case for much longer.

This isn't a call to action, I should stress. Honestly, if I was curious about buying a gaming handheld right now and already owned a PC, I would probably save my money instead.

But if you're dead set on buying a portable gaming machine to shove in your shoulder bag for your next flight, this is the one that makes the most sense in the current market.

And that's a wild state of affairs. With reports indicating that the memory crisis, and the associated tech price increases will continue (and likely worsen) throughout 2027, and possibly 2028 as well, I genuinely can't fathom what sort of price/performance metrics I'll be using to write handheld reviews over the next couple of years.

How do I score what are essentially hobbyist devices, pleasurable adult frivolities, when they all command such eye-popping amounts of cash? How do I square any real concept of "value" with devices that I know damn well would cost much, much less, if it wasn't for AI holding us all over a barrel?

Gaming is already an expensive hobby. Even more so when you want handheld convenience combined with high performance. But pricing seems to be rising at such a rapid rate, I wonder whether handhelds will survive as anything other than boutique devices for the very well-heeled.

They're very difficult to wholeheartedly recommend in 2026, I'll tell you that much for free.

Six years ago, PC Gamer's Evan Lahti wrote a headline that captured the feeling of the moment, when PlayStation announced it would be bringing more of its exclusive games to Steam: Well, I guess we won the console war.

The walls between platforms had crumbled. Everything but Nintendo was or would soon be playable on PC. Steam, not Xbox Live or PSN, was the kingmaker for new indie games, and the best place for devs to keep steadily selling their back catalog.

Things feel a lot different half a decade later, as AI wreaks havoc with hardware prices, Xbox panics about all the money it's spent on acquisitions, and Sony retreats from the PC—and physical media—back to its exclusive digital garden. And yet it still seems like the PC won the console war.

Because what are Xbox and PlayStation at this point other than PCs, but worse?

Sony's dual announcements—that it will cease producing physical discs in 2028 and also shut down the older PlayStation 3 and Vita online stores next year—seem to have been published simultaneously with a ripping-the-band-aid-off PR mentality. People are going to be mad, so get all the bad news out at once and hope you didn't remove too much flesh with the band-aid in the process. The takeaway of those two announcements landing simultaneously, though, is highlighting that you can only buy games on the PlayStation how and where Sony says you can. The executives have already literally said they want to wring more money out of every PlayStation owner; clearly cutting the Walmarts and GameStops of the world out of the equation is one way for them to do that.

Obviously the games industry has been trending towards digital-only releases for years; to the spreadsheet-brained it was just a matter of time until the cost of manufacturing and shipping of physical discs no longer made sense. The PC even led the charge on that front, meaning consoles clinging to the option of buying physical releases was one of their last true differentiators. Microsoft gave up on Xbox exclusivity, bringing all of its games to its own Windows Store and then to Steam. But those were just digital releases. If you really wanted to own a disc with Halo Infinite printed on it, you still needed an Xbox.

In 2020, Sony killed Microsoft's entry level Xbox Series S, an underpowered $300 machine, by selling its discless but otherwise fully capable PS5 at just $400. In the midst of the crypto mining craze making graphics cards unobtainable, the PS5 was a great console for the price. Today it costs $250 more, and Sony has also started raising prices for its PlayStation Plus subscription service needed to play games online.

Even with the painful prices of storage and memory hitting PC gaming hard, the consoles seem to be pricing themselves into irrelevancy. In the six years since the PS5 launched, Sony has produced so few of its once-system-selling blockbuster exclusives that it's hard to imagine spending close to $1,000 to play one new Naughty Dog game, one new Insomniac game, and a new God of War. The prestige just isn't prestiging as hard as it was on the PS4. Add to that the uncomfortable reminder that Sony can revoke the licenses to stuff you've bought on its platform, and that it will inevitably stop selling old games whenever it becomes too much work to bother maintaining an aging digital store, all while you pay it $80 a year just to play games on the internet, and you've gotta ask what the point of that device really is.

I guess it makes a nice sound when you turn it on.

Okay, less sarcastically—the system is designed to work nicely on a TV. The user interface is relatively easy to navigate. It's got apps. Those old chestnuts have been used to defend consoles against the scawwy computer for as long as I can remember. It was true in, like, 2004. But console interfaces get more annoying and ad-infested every year, while their games now offer multiple performance options to pick from in a shallow approximation of the PC experience. Valve's SteamOS, meanwhile, has made tremendous strides towards a controller-friendly interface without sacrificing the flexibility that has always been the PC's core identity.

Install SteamOS on a giant tower PC or a tiny box built from the guts of a PS5! Use whatever controller you want! Buy your games on Steam (the prices are always better) or get them DRM-free on GOG, or grab them from a legally questionable "abandonware" website if they're no longer on sale. Still have a soft spot for physical discs (or disks) and want to do everything on the up-and-up? A USB drive will cost you all of 20 bucks, and decades of PC games remain available on Ebay. There are probably even cool mods or fan projects that make them play nice with modern hardware.

The PC may have led the charge on digital games years ago, but the thing is: anyone can still make, sell, or play physical PC games if they want to. The only person who can take away your PC disc drive is you.

To sum it all up:

• The last PlayStation and Xbox that were meaningfully different from PCs under the hood came out in 2005 and 2006.
• Price was once their biggest asset—AI has killed that.
• Simplicity was their second biggest, but while they've been making that experience worse for years, Valve (and the open source developers behind great initiatives like Bazzite) have been making the PC's better.
• Genuinely compelling exclusives other than Nintendo's are anomalies, and it's hard to be heartbroken over missing one or two given the number of interesting games hitting Steam every single week.

Sony now sells an overpriced entry ticket to a walled garden that kinda looks worse than the forest just outside it, while Xbox is actively lighting its own grounds on fire. Simpler and cheaper used to be worth the price of admission for a lot of people. But the way things are going, by the time the PS6 arrives anyone who buys it will just be paying more for worse.

Microsoft has been extremely busy lately, taking a well-earned break from polluting the world with AI to eviscerate the videogame industry. The reports of potential layoffs and closures—coupled with the short-sighted strategies of other publishers, including main rival Sony—are devastating. And the bad news just keeps coming.

According to The Verge, Arkane's Blade is now on the chopping block as well. This wasn't entirely unexpected, granted. While Arkane's games tend to be critically acclaimed, immersive sims continue to be a hard sell. Dishonored 2 and Prey didn't meet Bethesda's sales expectations, and Redfall was just a complete mess.

Now, a vampire-hunting dhampir stalking the streets of Paris sounds like a pretty good setup for an Arkane romp, but while Blade is highly anticipated, we've heard so little about it since the reveal that there have been concerns that development isn't going smoothly.

Todd Howard recently attempted to put these concerns to rest only last week, saying Arkane was "doing a really, really good job" on Blade. This vote of confidence, coupled with Arkane art director Jean-Luc Monnet saying the game wasn't being cancelled and that fans need to let Arkane cook, seemed like good news.

But Todd Howard ain't in charge now—he might have confidence in Arkane, but that doesn't mean Microsoft and Xbox's leadership feel the same way.

The Verge reports that Arkane is one of at least five studios being considered for closure as part of a cost-cutting strategy. Blade was meant to arrive this year, the report says, but the unannounced release date has since moved to late 2027. Coupled with it running over budget, this has given Xbox the fear.

Arkane's death would be tragic—the immersive sim genre is not a large one, and Arkane's one of the few major studios still making this type of game. Arkane's also been around for a whopping 26 years. It's got an important legacy.

However! There might be light at the end of the tunnel. Microsoft is apparently considering selling Arkane off, a move that would salvage the studio—and hopefully the talent. Though the latter is far from guaranteed. Still, Arkane escaping Xbox might actually be a good thing. Bethesda really didn't get Arkane, and Xbox hasn't shown much more understanding. This is a studio that likes to take risks, working for a publisher that's terrified of them.

Certainly, things aren't going to improve at Xbox. AI-loving CEO Asha Sharma's big Xbox reset will gut Microsoft's gaming division, with at least 1,000 jobs rumoured to be at risk, and that's not including the layoffs due the reportedly impending studio closures.

Basically: Xbox is digging its grave, but there's still hope for Arkane.

Microsoft's likely got another wave of layoffs and studio closures coming, it's my displeasure to say—with multiple studios on the chopping block. It's another pip in a pattern of scattershot project cancellations and studio closures, in the same vein as the company shutting down Project Blackbird despite Phil Spencer loving it, or closing Tango Gameworks despite Hi-Fi Rush being touted as a success.

Basically, for Microsoft (and the wider industry at large) there's no real guarantee that good work will keep you in a job. And union members at the Communications Workers of America (CWA) spoke out in a press call (shared here by GamesBeat).

Morgan Goin, a senior encounter designer at ZeniMax Online—who has been through the wringer already, being caught in the shock closure of Arkane Austin and losing out on a month's employment before finding her feet—says that "there's a clear gap between what we need, how Microsoft talks about us publicly, and how we're being treated across all of their studios."

As a union rep, Goin feels like Microsoft's only talking the talk: "I have been entrusted with the responsibility to advocate for my coworkers. I cannot do my job when Microsoft refuses to do theirs. This isn't just affecting one studio or one department, it's affecting all of us. We refuse to be left in the dark as the company decides to restructure in a way that seriously affects us all.

"We're being treated as expendable, valued one week and cut the next. Why would a game developer bother to put forward their best work under these conditions? Hard work and great games do not save you from layoffs under Microsoft."

Allison Veneto, a senior editor for franchise development at Blizzard, a studio which also endured a game cancellation and a rash of layoffs after being acquired by Microsoft, comments: "Every time these layoffs happen, we lose incredible talent in years of institutional knowledge … We want layoffs to be treated not as a quick fix to a quarterly balance sheet, but only as an absolute last resort."

Senior environment artist at Blizzard Mahreen Fatima points out how little having a full-time job means under Microsoft's layoff-happy business culture: "In this climate of layoffs, it feels like there's really no difference between being contract and being full-time, we're all just as equally dispensable in the eyes of the company.

"Leadership points to revenue margins to justify fighting us. And then this week they raised console prices on players for the third time since 2025. They are not short on money. Look at the billions that they're using to invest in AI. They're just choosing not to protect us."

It's a feeling I generally agree with even as an outsider, and one I won't stop being exhausted by. The videogame industry has been experiencing massive growth, and CEOs like Microsoft's own Satya Nadella take home hundreds of millions of dollars. In fact, Nadella's pay jumped 22% between 2024 and 2025.

Last year, Microsoft made $27.2 billion in three months. It also planned to invest $80 billion in AI infrastructure. For the record, $80 billion is enough to keep a studio of 200 median-salary game designers ($113,000 annually) paid for 3,539 years, for a piece of technology that Nadella has openly said we need to do something useful with. You cannot convince me there isn't the money to keep these studios afloat.

As reports that major layoffs are coming to multiple Microsoft-owned game studios continue to swirl, numerous developers at South of Midnight studio Compulsion Games have indicated that they are leaving the studio and looking for new work.

Posting "open to work" messages on LinkedIn is a very common way for game industry employees to search for new opportunities—and, sadly, it's also often a first sign of layoffs at game studios.

• We're keeping track of all the Amazon Prime Day PC gaming deals here

That was initially thought to be the situation here as well, but according to Bloomberg's Jason Schreier it's not the case: Schreier said on Reddit that with layoffs looming, "studio leadership gave their employees permission to openly look for work because they almost certainly will be losing their jobs."

Still, it's clear that the move caught at least some Compulsion employees by surprise: Principal level designer Mike Sklavounos, for one, described it as "an unexpected turn of events." According to Eurogamer, at least a dozen Compulsion employees have indicated that they are looking for new work in some capacity, a significant number for a relatively small studio of about 90 employees.

More worryingly, the sudden spike in employees looking for work is also pretty close to confirmation that another Xbox bloodbath is in fact coming. Along with Compulsion, reports earlier this month claimed that Double Fine, Ninja Theory, and "several other studios" were at risk of closure as part of an "Xbox Reset" being shepherded by CEO Asha Sharma and CCO Matt Booty; the pair said in an open letter published earlier this month that Microsoft "over extended" itself with a rash of studio acquisitions over the past few years—in other words, yet another management failure that thousands of employees will have to pay for.

The current expectation is that the layoffs will be imposed in early July, following the end of Microsoft's fiscal year, which wraps up on June 30. Microsoft did the same thing in 2025, laying off thousands of employees and cancelling multiple videogame projects on July 2 of that year.

OD is Hideo Kojima's return to horror, and while I'd like to say it's cloaked in mystery we actually know a fair bit about it: it's co-written with Jordan Peele of Get Out fame, and stars Sophia Lillis, Hunter Schafer, and a posthumous Udo Kier. According to Kojima, early trailers may point to "a standard horror game" but it's definitely not that at all.

In fact, we've been told repeatedly that OD is like nothing else that's come before: what it actually is, is a mystery Kojima seems pretty eager to exacerbate. In a new Entertainment Weekly feature which seems designed, maybe with poor timing, to celebrate the virtues and achievements of Xbox as it enters its 25th year, Kojima is called on to comment about OD, which will be published by Xbox Game Studios.

"I wanted to do something new. I wanted to do something different," Kojima told EW. "I had this OD concept since I was working on DS1 [Death Stranding] and I was working on it just by myself. I can't reveal much detail, but it's something that no one has ever seen before. A new game system."

He goes on to say that despite being Hideo Kojima, the creator of Metal Gear Solid and Death Stranding, and perhaps the most beloved (maybe only) auteur in the biz, many weren't receptive to his pitch. "I pitched to many people, to the big companies, and also to the up-and-coming companies. All of them said the same thing," Kojima said. "They said that I'm crazy, and that they really don't understand the concept—that they will not be able to do it."

Phil Spencer, former Xbox head, was pretty keen on the concept though. Or else, he was keen to secure a crowdpleasing exclusive after Kojima's decades-long association with PlayStation. Most of the Metal Gear Solid games didn't or haven't launched on Xbox consoles, though the majority have since been reissued on that platform. Death Stranding and its sequel both launched as PlayStation exclusives: the first eventually came to Xbox, but the second is yet to make the jump.

New Xbox head Asha Sharma supports OD, calling it "deeply moving" and representative of "another kind of game". She also seems eager to conflate Xbox's support of the game with its broader vision for the medium as a whole. "We need to make sure our platform is sufficiently open so more creators and developers can come on board and be successful, because the next Kojima is yet to be known." (True, but perhaps he was among the thousands laid off by Microsoft in the last two years).

Kojima has a tiny bit more to say about OD: "I wanted to go beyond the limit of the 'scariness' that other games had reached. It's a single-player game, and I wanted to make it as scary as possible. But for those that might stop playing when it gets too scary, I have thought of a system that will allow them to keep going. I can't say much more, because it'll give too much of a hint on the system, and I could get in trouble for saying too much!"

OD has yet to get a release date.

Xbox is under fire yet again. It's teasing layoffs as part of a "reset", reportedly closing Double Fine, Ninja Theory, and more, and it can't present a coherent plan—all just days after unveiling upcoming games at its Xbox Games Showcase.

Rightfully, Xbox has been criticised by industry figures in response, including a former PlayStation exec. Now, Moon Studios CEO and Ori creator Thomas Mahler has taken to X (spotted by VGC), damning Xbox Game Pass.

"The Game Pass strategy could've worked if people would've shown up for it," Mahler claims, suggesting that the service's offerings (particularly new, exclusive games) weren't enough to keep people paying every month.

"You need those games your studios are producing to become smash hits, cultural events that everyone wants to play—but what was the big Xbox game in recent years that was just delightfully good? That game doesn't exist.

"Almost every single first-party studio in recent years has been floundering. You'd want Bethesda to create a 'Skyrim in Space' that ought to be better than Skyrim was cause that was an old game: But we got Starfield instead…[Xbox] need to have good deals with devs so developers are actively incentivized to produce massive hits, not just slop out mediocre content like a factory."

Mahler adds that Game Pass is "a little like Communism," in that if you don't give people an incentive to pitch in and subscribe, then the whole system "comes crashing down". When Xbox raised the price of Game Pass last year, it lost "millions" of subscribers, according to Matthew Ball, games industry analyst and newly-installed Xbox chief strategy officer.

It's worth noting that while Xbox's first-party lineup has struggled arguably since the launch of the Xbox One in November 2013 (ouch), Game Pass has served up some third-party hits. In fact, three of last year's game of the year nominees—Expedition 33, Hades 2, and Hollow Knight: Silksong—were available on the service day one. Kingdom Come: Deliverance 2 joined a while later, too.

The issue is that these games are available elsewhere, so they're not solid incentives for players to sign up for an expensive subscription. Forza Horizon 6 is the first big exclusive game for Xbox in a long time, breaking the records set by its predecessor. But one (timed) exclusive isn't going to move the needle to the degree the company demands.

Microsoft has spent the past few years laying off thousands of workers from its collection of game studios, which ballooned under former Xbox CEO Phil Spencer. Now it's set to cut more jobs and close more studios as part of new CEO Asha Sharma's "Xbox reset."

That years-long Xbox cost-cutting campaign has led to more game cancellations than we know about, ending huge projects that, at least on the surface, were exciting.

Were these "hard decisions" genuinely the pragmatic ones? The 2020s certainly have been marked by some massive flops, and it's possible that some of these projects were money pits. A couple of them were especially risky propositions: big, hard-to-make online games.

But as Microsoft doubles down on console exclusives and tries to hurry along heavy-hitters like The Elder Scrolls 6, I've got to wonder if it was wise to toss so much in-progress work, some of which was highly praised internally.

It's the risky games that are the most exciting, and while Gears of War: E-Day looks impressive in ways, it's not exactly an electrifying proposition this far removed from the 2010s. Given how profitable Microsoft is as a whole—it's making billions even as it dumps money into AI—was it really pragmatic not to let some of its best cooks cook?

Here are five of the big games Microsoft recently crossed off the upcoming list.

'Odyssey,' Blizzard's survival game | Cancelled in 2024

We first heard that Blizzard was making a survival game in 2022. Codenamed Odyssey, it had been in development for almost five years at that point, and Blizzard devs on and off the project were hyped about it.

Former Blizzard president Mike Ybarra said that he'd "played many hours" of the game and was "incredibly excited about the team's vision and the brand-new world it presents for players to immerse themselves in together."

"All I can say is it's gonna absolutely rock," said novelist and Blizzard writer Christie Golden. "Hella beautiful too. I cannot wait!"

Microsoft acquired Activision Blizzard in 2023 and cancelled Odyssey in 2024. Ybarra left the company at the same time.

According to a Bloomberg report, development of Odyssey had started in Unreal Engine, but struggled under a mandate to switch to "an internal engine that the company had originally developed for mobile games." Odyssey was not close to release when it was cancelled, the publication reported.

Maybe it was a classic case of development hell, but a survival game with Blizzard's polish, storytelling, and art direction sounds like a good idea to me, and unlike some genres, co-op survival hasn't calcified. Even in a quite unfinished early access state and after lots of corporate drama, Subnautica 2 sold over 4 million copies this year.

Everwild | Cancelled in 2025

We never got a complete picture of what Everwild was going to be. Rare is best known these days for Sea of Thieves, in which players battle it out on the high seas in search of treasure. Everwild, by contrast, appeared to be a game about being kind to animals.

Everwild had been development for a long time when it was cancelled, and was reportedly rebooted once, which probably didn't help convince Microsoft that it should continue to fund a game that contained no exploding barrels or grimacing men.

But the pitch for Sea of Thieves probably raised eyebrows, too. A casual game to play with your friends, but it's PvP and players can grief each other? No progression beyond cosmetics? And you want to spend how much time making the water look awesome?

Rare's creativity shines in the trailer above: I don't know what's going on with the giant amphibian that carries fish (or its young?) around in its mouth, but the vibe is great.

Everwild was cancelled in 2025 during one of Microsoft's mass layoff waves.

Perfect Dark | Cancelled in 2025

The 2025 cuts also claimed a reboot of classic Rare first-person shooter Perfect Dark and one of the studios that was making it, The Initiative. ("Several unannounced projects" were also vaporized that day.)

The gameplay video above is the last we saw of the FPS. An immersive sim-ish shooter campaign with sci-fi gadgets is perhaps not a cutting-edge concept in 2026, but you can say the same about Gears of War: E-Day and the Halo campaign remake. Perfect Dark is a beloved classic, and the response to the gameplay reveal was positive.

Take-Two reportedly tried to take the game off of Microsoft's hands, but couldn't reach a deal. The GTA publisher clearly believed it had potential, though, because it snatched up the former leads on the game to found a new studio.

Contraband | Cancelled in 2025

Contraband was a collaboration between Microsoft and Just Cause developer Avalanche Studios Group. It was going to be a co-op smuggling game set in the '70s, but Avalanche announced in 2025 that active development of the game had ceased. It could theoretically still happen without Microsoft, but it doesn't seem likely.

We never found out much about Contraband, which was announced in 2021 with the gameplay-less teaser above, but an open world co-op crime game from the Just Cause developer sounds like a good time.

Project Blackbird | Cancelled in 2025

ZeniMax Online Studios, the developer behind Elder Scrolls Online, had quietly been working on a new MMO—codenamed Project Blackbird—for over six years before Microsoft cancelled it alongside the other games it tossed out in 2025. Phil Spencer reportedly liked the game a lot, but that wasn't enough to save it.

ZeniMax Online Studios founder Matt Firor resigned as a result of the cancellation, and said earlier this year that he'd been waiting his entire career to make a game like Project Blackbird. In a separate interview in April, Firor said that Blackbird would've been "fantastic" and that Microsoft missed an opportunity by not following through.

The reason it got the axe, Firor says, is that public companies like predictable, consistent revenue growth, and an MMO with lots of front-loaded development costs represents "a very large bet."

"It's just: Big business is big business," he said. "Microsoft is Microsoft, right? And a giant successful videogame on the Microsoft level was frankly not that stimulating to them."

Some of the laid-off Blackbird team went on to form a new studio with a wry name, Sackbird, and are now at work on a new project.

"After years in AAA, we wanted the freedom to take smart risks without waiting for a greenlight or chasing quarterly targets," Sackbird COO David Worley said when the studio was announced. "We're fully employee-owned and funded, which means we only answer to people who are passionate about games."

Xbox is flailing again. Major studio closures loom, the AI boom continues to erode the affordability of console hardware components, no one seems to want those consoles anyway and, according to Microsoft CEO Satya Nadella—a fierce advocate of the AI industry crippling the rest of consumer tech—the corp isn't making enough money from its first-party games.

All this, despite Microsoft having a market value of over $2 trillion, and owning some of the biggest games studios and IPs in the world, including Call of Duty and Minecraft.

What's going on? Everyone has an opinion, some more authoritative than others. Among those opining include Shawn Layden, a high profile former Sony executive who helped usher in the PlayStation 5 before his resignation in 2019. Overall, he spent 32 years with Sony.

Sony's PlayStation, of course, has troubles of its own, but Layden bowed out long before the worst of them manifested. He's criticized the industry's pivot to live service—which has proven a terrible tactical shift for Sony—and the continued reliance that major publishers and platform holders have on blockbusters. He also thinks industry consolidation is "the enemy of diversity", and that subscription services stifle creativity.

In other words: the beliefs he espouses would seem to put Microsoft firmly on his shit list.

In a LinkedIn post, game design consultant Tadhg Kelly reiterates some of the blunders, strategic shifts and curious tacks taken by Xbox since Asha Sharma took the reins in February. "The Xbox identity crisis will continue until morale improves," he writes. "We've had:

• A new CEO after previous leadership was beheaded
• A rebrand that was kinda just the old brand
• A reaffirmation of expensive Helix
• A claim that hardware can't be expensive to win
• A claim that 30% margin is done
• A claim that 3% margin is trouble
• Matthew Ball and some new tech-industry hires
• A claim about refocusing on core franchises
• A showcase of new games
• A killing of studios making those new games
• A claim that gaming is important to Microsoft
• A comment that gaming at Microsoft needs to stand alone

"And on and on and on," Kelly adds. "Strategy isn’t a collection of contradictory decisions that might matter. That's just tactics. Bob and weave. Let's just get through this. Sad times for Big Green."

Layden sounded off in the comments. "At the risk of sounding like a 'hater' (which, I'm really not), the moves evince a basic misunderstanding of how the interactive entertainment world moves."

He added: "Iykyk [If you know you know], which also means if you don't you don't."

Those are strong words. It'd be like a carpenter evincing "a basic misunderstanding" of how a lathe works, 25 years after their apprenticeship.

Reading this comment I can't help but remember the words of former Activision boss Bobby Kotick, who said in an interview last year that he once told Satya Nadella that he shouldn't be in gaming at all. "We [Kotick and Nadella] had half an hour together and he said: 'what can you tell me about gaming'? And I was like, dude, you shouldn't be in gaming. You're not a creative company. You should buy Workday or something, SAP. This is not a creative DNA company."

Kotick continued: "When he called to do the deal I said the same thing to him. You need us, because you're not going to figure out gaming with what you have. But is this really the priority?"

One thing's for sure: if Microsoft is, as Nadella claims, "not monetizing" its entertainment despite its clear advantages in terms of wealth and IP ownership, then it can hardly be labeled a smart or even halfway capable business. Certainly not one well-equipped to handle an existentially consequential technology like AI is proving to be.

Either that or, as a diabolically wealthy, publicly traded corp who makes the majority of its money from cloud services, it isn't fit to work in the creative industries.

Bloomberg reports that Compulsion Games isn't the only Microsoft studio fighting to stay open during the great "Xbox reset" announced last week by new Xbox CEO Asha Sharma.

Double Fine, Ninja Theory, and "several other studios" are at risk of closure, reports the publication, which cited undisclosed sources who are familiar with Microsoft's plans.

According to The Verge, Ninja Theory will close unless it finds a buyer, despite just having announced a new Hellblade game at the recent Xbox showcase.

Double Fine is "in active negotiations to spin off," Bloomberg says, but job losses are expected even for studios that manage to buy their independence.

Double Fine was founded 26 years ago by former LucasArts developer Tim Schafer, and is best known for Brütal Legend, crowdfunded adventure game Broken Age, and the Psychonauts series, as well as candid documentaries about the gamemaking process. The studio recently released Kiln, a multiplayer party game, and Keeper, a puzzle adventure game about a sentient lighthouse.

Microsoft acquired Double Fine in 2019 under the direction of former Xbox CEO Phil Spencer, who oversaw a spree of studio purchases, including the landmark Bethesda and Activision Blizzard acquisitions.

Schafer and Spencer appeared together at a media summit last year, a few months before Spencer announced his retirement. At the event, Schafer praised Spencer and Microsoft for respecting Double Fine's creative independence.

"When we talked about becoming acquired, it was a big thing for me, like, 'How do we keep our culture intact?'" Schafer said. "And everyone was like, 'No, we really want you to stay who you are.' And that's been true all these years … You know, creatively, we can be like, 'Hey, we want to make this game about a walking lighthouse,' and they're like, 'Cool. Sounds cool.'"

Now Xbox is "over extended," according to Sharma, although Microsoft as a whole made nearly $32 billion in profit last quarter, and has invested billions into AI.

We also learned today that the head of Xbox Game Studios and its chief of staff have stepped down.

Xbox Games Studios head Craig Duncan has stepped down after just over a year-and-a-half in the role, reports The Game Business.

Duncan led Sea of Thieves developer Rare for nearly 13 years before being promoted to head of Xbox Game Studios in 2024, which put the rest of Microsoft's studios under his stewardship, including Double Fine, Halo Studios, inXile, Obsidian, Playground Games, and The Coalition.

Xbox Game Studios chief of staff Louise O'Connor has also resigned, according to the publication. O'Connor also hails from Rare, which she joined all the way back in 1999 as an animator. O'Connor was promoted to Xbox Game Studios chief of staff in August last year.

The news comes as Xbox's new leaders, Asha Sharma and Matt Booty—who took over after Phil Spencer retired earlier this year—begin to implement an ominous-sounding "Xbox reset."

In an open letter last week, Sharma and Booty said that Xbox's studio acquisitions have left it "over extended," and Bloomberg reported that "significant" layoffs are being planned. Word on the street is that award-winning studio Compulsion Games is on the chopping block, and Bloomberg reports that Double Fine, Ninja Theory, and others are also at risk.

I have reached out to Microsoft for comment on the reported departures.

Just days after signalling that large-scale layoffs at Xbox are imminent as part of its ongoing overhaul, Microsoft's gaming division is reportedly planning to shutter Compulsion Games, the award-winning studio behind South of Midnight and We Happy Few (via Kotaku).

Neither Xbox or Compulsion Games have yet made an official statement regarding the studio's closure or associated layoffs, but multiple Compulsion Games employees have posted on LinkedIn and other social media platforms that they are looking for work.

Based in Montreal, Canada, Compulsion was founded in 2009 and released its first game, Contrast, in 2013. We Happy Few followed in 2018, and its most recent release, South of Midnight, launched in 2025 to an impressive critical reception: We scored it 83% in our review, saying "its poignant tale of hope and sorrow tailored to Deep South mythos keeps its head raised high," and it won the Games for Impact award at the 2025 Game Awards, Best New Intellectual Property at the BAFTAs, and a Peabody Award for interactive media.

Xbox CEO Asha Sharma has warned recently of major changes coming to Xbox, including a refocusing of resources on its major franchises. A Bloomberg report last week said major layoffs were going to be a part of that overhaul, in numbers that all but guaranteed at least one studio closure.

Sharma came close to confirming that in a message shared with Xbox employees: "We expanded our studio system when we needed a pipeline of content to meet multiple strategies across subscription, streaming, and devices. In the process, we have found ourselves over extended as we executed on changing strategies in a landscape of more readily available content."

Compulsion's reported closure comes just months after Xbox's new bosses bragged about the studio's achievements: In April, Sharma posted on X to congratulate Compulsion on its Peabody award, calling it "a well-deserved recognition for storytelling that truly matters." In a Game File interview published the next day, she said "the big things that we’re thinking about are we want to make great games," naming South of Midnight as an example of the kind of quality Xbox would supposedly be pursuing.

"South of Midnight today won a Peabody Award, which I think is such a validation of the storytelling capability of games these days," Matt Booty, Xbox's new chief creative officer, said in the same interview before elaborating that Microsoft is "dedicated to places where new [intellectual property] can come to life and where these stories can be told."

If Compulsion is the first closure to happen since Sharma's letter to Xbox employees was posted, it quite possibly won't be the last: With fewer than 100 employees listed on the company's LinkedIn page, it represents only a small percentage of the total cuts Xbox is expected to make over the next several weeks.

The resuscitation of Xbox has begun in earnest, but there's still much to be done, and still great uncertainty: Console exclusives are back but to what extent remains unclear, and of course the "reset" for a better future will almost certainly mean putting hundreds of people out of work. And it's possible that even bigger things could happen: A new report from The Information (via Reuters) says Microsoft is looking to shift its focus and resources to its biggest games, while simultaneously mulling the possibility of cutting the division loose entirely.

Three sources told The Information that Microsoft hasn't ruled out the possibility of spinning the Xbox division off as a standalone company, or making it a wholly-owned subsidiary. It's also apparently considering a joint venture with other partners—none named—which could make Xbox easier to sell after its overhaul. Nothing is imminent, according to the sources, but nothing is off limits, either.

The report also states that Xbox CEO Asha Sharma's plan to increase spending on Xbox's biggest game series, including Halo, Fallout, and The Elder Scrolls, has been approved by Microsoft CEO Satya Nadella and CFO Amy Hood, although the actual budgeting hasn't been locked down.

The primary goal of the increased spending is to speed up development of games in those series, and fair enough as far as it goes: It's been 11 years since Fallout 4, 15 years since Skyrim, and eight years since The Elder Scrolls 6 was announced, and we still have nothing to see but this empty teaser, and not even an official title:

Halo has also stagnated. As PC Gamer's Rory Norris wrote after the Xbox Games Showcase last weekend, Halo "has been treading water essentially since Microsoft set up 343 Industries to shepherd it into the future after Bungie's departure. That was almost 15 years ago, by the way." Halo Infinite, envisioned as the live service future of the franchise, halted new content updates in 2025, just four years after it launched. I don't think anyone expects, or wants, annualized Bethesda RPGs, but you can understand why Microsoft would want to hurry things along a bit.

At the same time, if there's one thing we've learned over the years it's that throwing money at this particular problem won't necessarily solve it. Microsoft has a big advantage over other mega-corps in that it already owns some of the biggest names in gaming, but whether it's able to make anything out of that—and whether it wants to make the effort in the first place—remains to be seen.

I've reached out to Microsoft for comment on the possibility of an Xbox spinoff and will update if I receive a reply.

Videogame analyst Matthew Ball predicted in his "State of Videogaming in 2026" report released earlier this year that in-game ad placements will become more common in PC and console games and services in the future, as they're a largely untapped source of revenue—income the industry needs and is increasingly struggling to find. Now he's the newly-hired chief strategy officer for Xbox, and in an interview with The Game Business, he says he hasn't changed his mind.

Ball said the issue is a "two-sided problem": The cost of making games keeps going up, particularly on the big-budget side of the street where Microsoft lives, and so is the cost of the hardware on which those games are played. All of that ultimately lands in the lap of consumers, who are eventually forced to reduce or stop spending money on games—and that's bad for the game companies in turn, because without consumer spending, growth stops, and growth is the core pillar of the economic system we've decided is best.

The solution, then, at least for this particular aspect of what is actually a very big and broad problem, is to figure out some way to keep people coming through the door (lower prices) without cutting into the monthly take (the consequence of lower prices). Thus, ads.

"I think the best evidence comes from the [TV] streaming space," Ball said. "In excess of 100% of net adds in the United States for years and years have been on the ad-supported tier. That has not excluded anyone from ad-free experiences. Those products are still there. They’re still popular.

"The question is not can we cram ads in everything. The question is, are there opportunities that allow the people who can't afford, or wouldn't try, to have an onboard to our properties and franchises?"

A recent Comscore report supports Ball's claim. Simply put, Netflix is embracing lower-priced ad-support subscription tiers because that's where the growth is: 45% of the service's "total household viewing hours" came from the ad-supported tier in 2025. And it's not unique to Netflix, as "total hours watched across major free ad supported streaming services grew by 43 percent year-over-year."

Whether or not it will actually happen (although I think the real question at this point is, how soon will it happen?), Ball cannot say: He's the chief strategy officer for Xbox so it seems like the kind of thing that would be right up his alley, but he said he's not privy to Microsoft's monetization plans. He does think it's a good idea, though, and not just for Xbox, but for gamers as a whole.

"[His interest] is coming from that perspective of how do we reach more people? How do we keep our products affordable? How do we make sure that we can continue to fund outstanding work from our development teams?" Ball said. "That’s the goal. It’s not about placing an ad in front of someone so that we can sell, you know, a pizza."

On Sunday, Microsoft put on its annual summer showcase at the Los Angeles Academy Museum of Motion Pictures to hype up the games coming in the year ahead: a Halo remake, a Gears of War prequel, a new action game starring Senua. At the showcase, new Xbox CEO Asha Sharma announced that fans with special badges at the event—all of whom paid their own way to Los Angeles and surely own an Xbox—will get a free limited edition Xbox Series X console.

On Wednesday, an open letter to Xbox employees titled "Xbox Reset" warned that the business is "currently unable to make as many consoles as players want to buy," and that the company "over extended" in its studio acquisition spree over the last few years. The casual tone of the message being signed "Asha and Matt" is a poor match for what it signals:

This month was the time for Asha's first big giveaway. Next month it will be time for Asha's first big layoffs.

It's long felt futile to point at the obvious hypocrisy of, say, giving away a bunch of consoles while complaining you can't manufacture enough to meet demand, while your parent company itself creates the conditions leading to the current "hardware component crisis," as Matt and Asha call it.

Those in charge can handwave that criticism away: 'It wasn't that many systems, really.' Or 'this fiscal year's budget is already set; it's next year's where we have to tighten our belts.' Or 'you gotta spend money to make money, right?'

The act of running one of these multibillion-dollar companies requires fully committing to—if not actually believing—the Orwellian doublespeak of it is the best of times and also it's time for hard choices. Or in the precise words of Asha and Matt's "Next 100 Days: Xbox Reset," they are poised to "build the #1 gaming and entertainment company" even though Xbox's "current platform infrastructure is not built for the battle ahead," it hasn't "adequately funded [its studios] to compete and win," and its hardware costs are now "over 5x the prices" it paid just two years ago.

The game developers working at the Xbox studios Sharma seems poised to lay off at the start of the fiscal year in July will surely appreciate the acknowledgement that they created "industry-defining franchises that have enormous potential and player demand," even if the publisher didn't adequately invest in them. It's not you, it's me is a famously well-received consolation.

Xbox flip-flopping on console exclusives, asking fans on X.com whether it should capitalize its name, and talking about "empowering new types of games" that can survive the RAMpocalypse all suggest a desperate flailing in search of a plan. But the plan for more cuts was surely preordained from the start of Sharma's first 100 days—as noted in today's letter, the division is making a mere 3% profit margin, a fact Asha and Matt did not just learn today.

That's a bad number! Unless you consider it in the context of the $32 billion in profit that Microsoft as a whole raked in just last quarter, in which case the idea of Xbox being in dire straits seems just as imaginary as the letter concluding on the feel-good back pat about Xbox creating "one of the few places where people come not just to play, but to connect with others to create memories."

Every we hear you missive to the fans is just spin for the brutal reality that the mandate for higher profits will mean more misery for studios Microsoft failed to safeguard.

Sharma was not hired to make brilliant decisions and redirect overnight the lumbering vessel that is any giant corporation changing strategies. She was hired to keep up a convincing smile while serving one pre-wrapped shit sandwich after another, and we're all stuck at the buffet.

Due to the memory pricing crisis that its own AI ambitions are helping cause, Microsoft does not know how to sell a new Xbox that feels cutting-edge at a price that regular people can afford.

The next Xbox, codenamed Helix, will have "leading-end performance," new Xbox boss Asha Sharma said in a recent interview with Fortune, but I'm left wondering how Microsoft defines that, because everything else she said downplays its likely technical capabilities.

What the console business needs, Sharma said, is "new business models" rather than "just the most premium, high-performance console in the world."

"I think we've reached a point where it will be hard to imagine that mass audiences can afford thousands of dollars to spend on a console generation," she said. "So I think we will see radically different business models that we never expected come into orbit later this year."

It's an astonishing place we're in. Consumer devices always involve compromises for the sake of affordability, but this is the first time I can remember a tech company lowering expectations for its next big gadget so dramatically.

Sharma went on to say that Microsoft will "have to think very differently about storage and memory going forward."

"We will have to apply new techniques so that we can compress [games]," the Xbox CEO said. "We will have to empower customers to have very flexible storage offerings. We will have to empower new types of games so that they can fit on-device."

There are outlines of ideas there, but Xbox has already done "flexible storage options," and what it means to "empower new types of games so that they can fit on-device" is anyone's guess. (Are they going to put "Now with smaller games!" on the box?)

As for "new business models," perhaps Microsoft will offer financing? A rent-to-own plan?

Another guess is that we're talking about cloud streaming. It's not strictly new—RIP Stadia—but it fits in well with big tech's AI obsession. At a GDC session I attended in March, Nvidia DLSS pioneer Bryan Catanzaro said that "AI is fundamentally much more efficient in the cloud." That's a useful premise if you want to move toward a world where games are served like Netflix shows and at-home devices can get by with less RAM and SSD space.

For now, it's clear that Microsoft is still trying to figure out what to do about this self-inflicted problem. The challenge faced by Xbox was reiterated today in an open letter to employees with no specific plan laid out to solve it.

"We are currently unable to make as many consoles as players want to buy, and we need a new business model and partnerships for hardware as we remain committed to Helix," Sharma wrote in the letter.

It'd be funnier that the AI true believers are doing this to themselves if they weren't screwing up everything else, too. I don't really care whether the next Xbox is loaded up with RAM, and I don't need my next PC to render perfect photorealistic graphics—but it'd be nice if it were at least affordable. Valve still hasn't told us what its new Steam Machines will cost, but it doesn't bode well that a 1TB Steam Deck now goes for $950.

I have no doubt that PC gamers will find a way to keep doing what we do, but there may be a long cold winter ahead, so safeguard that DDR5.

There was a spot of confusion when Xbox CEO Asha Sharma declared during the recent Xbox Games Showcase that Gears of War: E-Day is an "Xbox console exclusive." What, we wondered, does that mean for us when it's said by Xbox's new management? In a new interview with GameInformer, Xbox chief content officer Matt Booty laid it out: The strategy is all about hosing PlayStation.

Okay, he didn't say that in so many words, but that's clearly the intent. "When we say 'console exclusives,' it means Xbox console," Booty said. "It'll still show up on all the normal places where we sell the PC version, and our cloud. Wherever you can get Xbox Cloud streaming."

So the pullback is less about "only on Xbox!" and more "not on PlayStation!" which isn't quite the same thing, but does square with Sharma's admission in April—more of a reminder, really—that "our presence on PC isn't strong enough." And since PC gaming is dominated by Windows, made by the company that also makes Xbox, there's a synergy between platforms that Sony just doesn't have—which helps explain why PlayStation would actually embrace non-presence on PC as a feature, not a bug.

All of this matters because in the actually-not-very-long-ago times, exclusivity was the bane of PC gaming. A huge number of great PC games debuted first on one Xbox console or another—Halo, Fable, Alan Wake, Gears of War, Jade Empire, KOTOR, and Mass Effect, to name a handful—and took months or even years to come to PC. And it sucked!

Microsoft eventually seemed to figure out that it was leaving money on the table, but so did Sony—until it decided, I guess, that PlayStation or nothing is actually more lucrative in the long run. So when Microsoft started rumbling about a return to exclusives, I think it's very understandable that a lot of us would start getting that ol' CJ feeling:

Confusing matters further, the Xbox exclusives strategy is still very fluid: The new Gears is exclusive, for example, but Halo: Campaign Evolved—an even bigger name in the Xbox pantheon—is not.

"We're the number two publisher in the world and in order to be a great publisher, you must have your games reach large audiences to play," Sharma said in a recent Bloomberg interview. "At the same time, we're increasingly becoming a platform. In order to be a platform, you must have exclusive content and services. And so, we're looking at that very closely. I think that we have to be very thoughtful about each title on how we want to think about it and learn from similar cases in the industry, and that's what we're doing."

I can't say that really clarifies the situation for me, so it's nice to have Booty putting it in simpler terms.

Despite what you may have heard, Marvel's Blade, the daywalker action game in development at Arkane, is not cancelled. The proof of life came from Arkane lead concept artist and assistant art director Jean-Luc Monnet, who delivered a short-but-pointed reassurance to fans on X after the game missed its second Xbox Showcase running.

"Let us cook."

Concern about the fate of Blade, and Arkane as a whole, is understandable. Despite making some of the best immersive sims (and thus, by definition, some of the best videogames) ever, Arkane has struggled to put a genuine hit on the board. Dishonored 2, despite its lineage, did not sell especially well, and Prey is a massively underappreciated gem; and the less said about the Bethesda-imposed live service catastrophe Redfall, the better.

Microsoft closed Arkane Austin in 2024, a year after Redfall's release, and that brutal handling made the future of the studio as a whole seem far less certain than it should be. PC Gamer's Fraser Brown, in fact, wrote that the absence of Marvel's Blade during the Xbox Games Showcase had him worried about Arkane—and this was in 2025. Rolling through 2026 without even a reminder of its existence naturally conjured up even deeper concerns, especially given Microsoft's desire to prove that it's still in the fight—and the fact that it had relatively little to actually prove it.

So it's reassuring news for Blade fans, but possibly still a bit of a stressful situation for the more specific crowd of PlayStation-owning Blade fans. As a licensed Marvel game, my assumption is that it will be released on all platforms—but platforms haven't been announced, and Microsoft's recently turned its eyes back to console exclusives as it gets ready to fight the next round of the console wars. Insomniac's upcoming Wolverine game is a PlayStation 5 exclusive—it'd be a hell of a get for Xbox if it could turn the tables with Blade.

Microsoft recently reversed the sky-high Game Pass price increases it imposed in 2025, bringing them down to not quite where they were prior, but close enough to quell at least some of the complaints. The move came not long after Xbox CEO Asha Sharma admitted the prices were too high—but it sounds like the impact of those hiked-up prices was perhaps even bigger than most of us expected.

Matthew Ball, games industry analyst and newly-installed Xbox chief strategy officer, said during a Summer Game Fest interview with Game Business Live, reported by GameSpot, that Game Pass lost "millions" of subscribers over the months after the October 2025 price increase, which saw the top-end Game Pass Ultimate go up by 50%, from $19.99 to $29.99 per month.

Losses on that scale would certainly explain why Sharma prioritized the Game Pass price reduction. That cut came with a cost of its own—Call of Duty games will no longer be available on Game Pass at launch, but will instead be added about a year after they launch—but this seems to be one of those cases where the bottom-line number at checkout time is what matters, as the price cut had a positive impact almost immediately: In May, just a month after the reduction was announced, Sharma said that "we have seen [Game Pass] acquisitions grow and retention improve"—not a complete turnaround, but "a good first step."

Ball repeated that sentiment, saying the price cut—Game Pass Ultimate is now $22.99, still an increase but not nearly so jarring—is "resonating" with gamers.

The Game Pass price cut is just one part of a broader effort to turn things around at Xbox: While Sharma's tenure at the head of Xbox was initially expected by some to be brief and terminal—Seamus Blackley predicted she was brought in as "a palliative care doctor who slides Xbox gently into the night," although he later seemed to change his mind—recent moves like the Game Pass price cut and return to console exclusives point to a concerted effort to put Microsoft's console business back on competitive footing. Whether it pays off remains to be seen, and a lot of it so far seems to be nostalgia over substance, but the fact that it's happening at all is notable entirely on its own.

If there was one consistent message from today's Xbox Games Showcase, it's that stuff is back. Crazy Taxi is back, Spyro is back, Persona 4 is back, the first Halo game is back, Gears of War is getting a back-to-basics prequel after its so-so open world reinvention, and even transparent electronics are due for a reprise.

The new ideas on offer also sported a decidedly nostalgic tone, whether we're talking about the familiar zombie-blasting of State of Decay 3 or the Bioshockish, extremely steampunk-coded Clockwork Revolution. Outside of those games, Microsoft's coterie of acquired developers has been constructing a tall tower of sequels, reboots, and revivals: Fable, Minecraft Dungeons 2, Modern Warfare 4's DMZ mode, and so on.

There was even an emphasis on less fuzzy memories—namely, the console wars. Both Gears of War E-Day and Clockwork Revolution proudly punctuated their trailers with the stinger that they're "Xbox console exclusives."

Since they're both still coming to PC, presumably at the same time they release on Xbox, the only purpose of all that seems to be dunking on PlayStation. Similar to Sony's retreat from PC gaming, it's hard to know how many people outside of the hardcore fanbases will really care. As PC Gamer's Morgan Park points out in his article about that, it's a harder sell when games take half a decade to release. And in an era when Halo is on PS5 anyway, is the posturing even convincing?

The games themselves don't mark a new strategy, as they're the fruit of years of work, but Xbox's new CEO herself, Asha Sharma, seems keen to go back in time. She countered the notion that exclusivity is antiquated earlier this week, saying "in order to be a platform, you must have exclusive content and services." Xbox is all caps again, and the new logo is greener than Gak—this may not be an entirely new direction, but it feels like Microsoft is hoping to rope people in with a retro cool more than ever.

It's easy to see why, looking at the company's last few years. Microsoft Copilot's sudden unwelcome ubiquity turned out to be the mistake plenty of users identified it as. Microsoft has been named a pressure target, and Xbox a priority target, of the BDS movement protesting its involvement in Israel's ongoing genocide of Palestinians. That has led to turmoil within the Xbox umbrella and at least one high-profile dismissal at Microsoft. Shareholders are uneasy, employees have led protests, and even Windows 95 startup composer Brian Eno suggested the company was complicit in war crimes.

At the end of 2025, PC Gamer's Wes Fenlon declared it Microsoft's year of shame. Maybe that's why going backwards in time is so attractive for the tech and gaming giant: the first two Xbox consoles brimmed with potential, free from genocidal associations and hallucinating chatbots.

But it's hard to imagine this 'good old days' act will be convincing for long if AI continues to encroach on everything the company puts out and it keeps courting blood-soaked controversy. If Microsoft really wants to go back to the golden years, it will have to start by jettisoning the baggage it's accrued in the intervening decades—in other words, actually moving forward.

Today's Xbox Showcase just wrapped up, and amid all the blood, guts, and wackiness the standout trailer for me had to be the calming life sim, Vivarium.

It's not that I don't like my fair share of gore—State of Decay 3 and Metro 2039's new trailers both looked fantastic, and I can't wait to play them, but a Ghibli-styled cosy life sim? Hell yeah, that's what I get out of bed for.

This is the first time I'm seeing anything about Vivarium, but I like what I'm seeing. Set inside a "perfect" pocket world you play a protagonist in a life sim adventure progressing through a non-linear narrative which is apparently shaped by your own choices.

To do so you need to chat to the locals, who are peculiar yet charming anthropomorphic animals, plus a doll, who is also your best friend (no judgement here). You'll learn more about your neighbours and the secrets that this world holds.

It all sounds absolutely delightful. I'm something of a horror mega fan, but I always like to have a slower-paced cosy game in my back pocket for mental emergencies. It works just as well as watching cute animal videos in my experience.

But it's greatest strength, in my humble opinion has to be its hand-illustrated art style which has clearly been inspired by anime classics like those from Studio Ghibli. Watching the protagonist amble through forests and over babbling brooks feels good for my soul. My love for this style is almost certainly nostalgic, but it doesn't make it any less beautiful.

The only catch is that we don't have a release date for this lovely life sim yet. We do know it will release sometime in 2027, so let's just hope it's sooner rather than later.

I've not had any first hand experience at running a cult. But I have enough faith in my people skills and resource management to believe I'd do a pretty decent job, and I'm willing to put my theory to the test in Wolf Haus Games' upcoming doomsday cult simulator game Join Us—what you didn't think I'd be daft enough to actually start a cult, did you?

We just got a fresh look at Join Us during today's Xbox Showcase, but let me run you through all the details.

It's a run through of the basics any cult leader would need to know. Being an open world survival game you can head out into neighbouring towns to recruit people or just piss them off. As well as expand your territory, stockpile military-grade weapons, sacrifice followers, and farm tomatoes (that last one is key to any decent cult).

You can also specialise your belief system—UFOs, cannibalism, and intermittent fasting are all on the table for core belief systems. I already know which one I'll be picking, but I'll leave that up to your imagination.

You can also team up with your friends to run the joint with four player co-op. Although, I'm not sure how the leadership structure would pan out with that. It may be best to decide on one ruler beforehand so you don't get into any petty scuffles.

The only catch is that we have to wait a little longer to put all our expertise to the test: Join Us will be releasing March 2027. Just remember folks, don't try this at home, it's best to wait for the game's release.

I'm one of the main survival game fans here at PC Gamer, so when showcases come around in the summer and winter, I'm usually assigned to cover a couple.

For years now, I've had standing orders to cover any State of Decay 3 announcements, and for years now, there haven't been many to cover. It was first announced way back in 2020, but Undead Labs has been mostly silent since then.

In fact, I'd pretty much forgotten about it entirely until today, when State of Decay finally showed some signs of life with a new trailer at the Xbox Games Showcase. And as I watched, I crossed my fingers that we might finally get a release date. C'mon! Just give us the digits already!

Well, we got a few numbers at the end of the trailer, at least. State of Decay 3 is coming in 2027. No month. No day. Just the promise of a year.

Hey, I'll take it. In an industry where games are getting outright cancelled all the time, I'm just glad to see it's still twitching. Here's the trailer:

"Well, I guess we won the console war," PC Gamer's Evan Lahti declared back in 2020. It was a time of clear skies and hope: Microsoft had embraced Steam, Sony was bringing first-party games to PC, and we were all waving flags and pounding vodka shots atop silent tanks in Red Square. Metaphorically, anyway.

But now it looks like the fight is back on. Sony is backing away from its strategy of releasing PlayStation exclusives on PC, and now Xbox CEO Asha Sharma has hinted that Xbox is reconsidering its own approach to exclusives.

"We're the number two publisher in the world and in order to be a great publisher, you must have your games reach large audiences to play," Sharma said during a recent Bloomberg interview. "At the same time, we're increasingly becoming a platform. In order to be a platform, you must have exclusive content and services. And so, we're looking at that very closely. I think that we have to be very thoughtful about each title on how we want to think about it and learn from similar cases in the industry, and that's what we're doing."

Like the unceremonious axing of the 'This is an Xbox' marketing campaign, Sharma's statement is a clear repudiation of former Xbox president Sarah Bond, who said flat-out in October 2025 that "the idea of locking [games] to one store or one device is antiquated for most people."

A potential refocus on exclusives is also obviously more about Xbox's dealings with PlayStation than PC. Shortly after Bond's comment, Microsoft announced its Halo remake for PlayStation, and man, it was over: As PC Gamer's Morgan Park put it at the time, "Though he shared joint custody with PC gaming in moments, Master Chief was Xbox ... His olive green armor practically was the console's logo in superhuman form. Now he's just the guy from Halo."

But now it sounds like maybe it's not as over as we thought. The direct impact on PC gamers may not be all that great, especially given Sharma's April acknowledgement that "our presence on PC isn't strong enough."

But we've all heard that one before—maybe more than twice, depending on how long you've been on this ride. If Microsoft really is "recommitting" to Xbox as a console, I don't think that, for instance, a future shift back toward more timed-exclusivity windows for big releases is beyond the question. Rockstar is holding back on a PC release of Grand Theft Auto 6 because PC players aren't GTA's "core" audience, which is baffling but also reflects the ongoing console-centric viewpoint of many game industry decision-makers.

It sounds like the situation at Xbox is still very fluid, as they say in polite circles when nobody really knows what's going on, and what actually comes of it is anybody's guess. But those heady days of inter-platform peace and prosperity, with the PC as gaming's great unifier, sure do look to be over, and one way or another, some of that fallout is going to land on us.

Although many developers turn to Unreal Engine or Unity to bring their gaming visions to life, open-source Godot is becoming increasingly popular, thanks to its lightweight structure and intuitive scripting language. Now Microsoft has taken a 'first step' to expanding its user base even further, by releasing a reference sample software package for creating Godot games for Xbox on PC.

Yes, I know I should be writing XBOX on PC, given that Microsoft has decided to settle on the format, but I'll be writing Xbox until I'm in the grave. Anyway, nomenclature aside, it should be noted that Microsoft hasn't released an 'Xbox-version of Godot' or anything like that.

Instead, it's essentially a demonstration of how to implement all of the necessary Xbox on PC requirements (such as Xbox services, PlayFab, and GameInput) in a Godot-based game.

"This sample shows you how to bring sign-in, gamepad controller support capabilities and more into your game with Godot. It includes insights, re-usable integration code, and is currently compatible with the April 2026 GDK out of the box," writes Microsoft in its dev blog post.

Although Godot has been traditionally associated with 2D indie games, such as Brotato, Slay the Spire 2, and numerous cozy games, it does handle 3D graphics extremely well, and there's a decent spread of things being developed that sport visuals that wouldn't look out of place in anything made with Unity or Unreal Engine (full-blown ray-tracing aside).

I've dabbled with UE for many years, going all the way back to the late 1990s with its first iteration, having first dipped my toe into it all with UnrealEd and custom maps for Unreal Tournament. These days, Unreal Engine is a massively complex and capable package, used for games, TV shows, and more, but while it's relatively straightforward to get started with, mastering it is on a whole different level.

By having a much smaller remit, Godot is arguably easier to work with, although it's perhaps still not quite as novice-friendly as Unity. But since it's also entirely free and open-source, any revenue your game makes is 100% yours. Well, yours and the publisher's. Oh, and the platform that you sell it on, too.

Microsoft says that its Godot sample is a "source-only sample" and "not a product", as well as purely for PC at this stage, and that there is "no set update cadence for support or maintenance." That doesn't sound overly encouraging, I grant you, but the software giant does promise that "This is the first step in bringing Godot for Xbox on PC. We plan to evolve it over time based on what the community tells us is most valuable."

I suspect we won't see a full Xbox on PC version of Godot any time soon, or perhaps even ever, but if Microsoft really is serious about saving its Xbox brand, more Godot samples like this one would be a step in the right direction.

Sometimes, if you want people to buy more of something, lowering the price can be an effective way of making it happen. You might already be familiar with that theory of economics but for those who are not, a real life example: In an internal memo shared with The Verge, Xbox CEO Asha Sharma said lowering the price of Game Pass seems to be working out pretty well.

Sharma said in April that Xbox needed "a better value equation" on Game Pass, the price of which had jumped significantly in October 2025: The top-tier Game Pass Ultimate saw a 50% hike, from $19.99 to $29.99 per month. A week after Sharma's declaration, those prices were reduced: They stayed higher than they were prior to that October 2025 increase (Game Pass Ultimate went down to $22.99 per month, for example), and there was a cost: Call of Duty games will no longer be available on Game Pass at launch, but will instead be added about a year later—so, about the time that the next annual CoD shows up.

But it seems that the bottom-line price tag is more important to some sizable chunk of the Game Pass audience. "Growth slowed down and subscriber loss accelerated after the pricing and SKU changes last year," Sharma said in the memo. "Since our price reduction we have seen acquisitions grow and retention improve, which is a good first step."

And it is, apparently, just a first step: "We will not solve this in one moment or one launch," Sharma continued. "We will have to outwork the problem in front of us in our path to restore durable growth."

I don't think there's any question that Game Pass had grown too expensive for a large portion of the Xbox base. $360 a year isn't a huge amount of money and probably still a good deal overall for die-hards who are powering through multiple new releases per month, but for more casual folks who get into maybe a half-dozen games a year, it starts to look like maybe a bigger commitment than they need—and that says nothing about the damage 360 bucks can do in a good Steam sale.

It remains to be seen where Game Pass goes from here, but I think cut the price and call it done is unlikely. One distinct possibility is a greater emphasis on ads: Rumors of an ad-supported Xbox Cloud Gaming service surfaced not long after the Game Pass price hikes, and I wouldn't be at all surprised to see something similar toyed with on Game Pass itself.

Sharma also mentioned the recent rebranding of Xbox to XBOX, saying it "reflects a decision to be deliberate in how we show up for the players who care most about this brand." As you may have noticed, we will not be taking part in that particular exercise.

Just over a month after denying a rumor that Fable would be delayed into 2027 to avoid the Grand Theft Auto 6 behemoth, Fable has been delayed into 2027 because "the year is packed with incredible games," one of which just happens to be Grand Theft Auto 6.

"Packed" is maybe overstating it a bit, based on the list rolled out by the official Xbox account on X, including Halo: Campaign Evolved, Gears of War: E-Day, Call of Duty: Modern Warfare 4, Control Resonant, Star Wars: Galactic Racer, and—finally—Grand Theft Auto 6. Modern Warfare 4 is going to suck up some oxygen, sure, but overall I feel like it's a list of games that leaves room for a big-name release like Fable. Except for one of them, I suppose.

"In order to plan our game launches through the holidays, we're moving Fable to February 2027 so it can have the dedicated moment it deserves," Microsoft said. "We're excited to be giving players a major new look at Fable, as well as our broader lineup, at Xbox Games Showcase on June 7."

While we don't have a solid new release date at this point, the February 2027 target is at least a little more precise than the previous launch window of fall 2026. Will it actually arrive in February? Maybe—maybe even probably—but given that we've been talking about Fable 4, as it was known in those days, since at least 2019, which was a full-on decade after the release of Fable 3, I'm going to mark my calendar in pencil, just in case.

As strange as it is to say, I often feel like I'm forced to use the Xbox Controller whenever I turn on my Xbox (which is getting rarer and rarer nowadays anyway). It's still a lovely feeling pad, but it genuinely feels like a downgrade when putting down the Victrix Pro BFG Reloaded, Gamesir G7 Pro 8K, or even EasySMX D10, which I usually have to hand for my PC.

I've come to the realisation that, even ignoring the fact that Sony and Microsoft's standard controllers don't have much protection against stick drift, I still wouldn't pick them if I put them head to head against the rest of the controller market.

And yet, they still hog most of the conversation around controllers, and still regularly sit on Amazon's best-selling list. Case in point, two different listings for the Xbox controller(1 and 2) both have Amazon added tags ("Overall Pick" and "Best Seller" as of time of writing), and these serve to place those controllers front and centre to potential buyers. But this preference isn't only a thing on storefronts.

I'm interested in the Steam Controller. I don't really like its polling rate or membrane buttons, but its mouse input is neat, and it comes with drift-resistant sticks, which I'd argue should be almost mandatory for a controller now. But I noticed a common narrative came out during its launch: the belief that it's better than Microsoft and Sony's gamepads. While I think that's debatable, I'm left wondering why we are forced to choose only one of those three.

One post went around a few weeks ago, which now has over one million views and over 8K likes as of the time of writing, that directly compares the Steam Controller to Microsoft, Nintendo, and Sony's offerings. It shows that Valve's new controller has tonnes of features that none of the others do, and it justifies the price. It argues, "If your only argument against the Steam Controller is the price, you're stupid."

And it's easy to see why third-party controllers are often left out of these conversations. For one, as I noted at the start, Microsoft's platform is a finicky beast that only allows controllers to work wirelessly if they use its tech. This is why the GameSir G7 Pro has Xbox wireless versions (like the ZZZ and Wuchang model), which are more expensive. Unlike PC, you can't just grab any old wireless controller and get it working.

But the second, I think, is its history. Growing up, using a non-official controller often meant you were player two. It meant you had to deal with the jammy buttons, sticky bumpers, and weird thumbsticks. Third party meant cheap, both in cash and in feel. And I'm not convinced it has managed to shake that history. I do really like the EasySMX D10, but it being covered with RGB certainly doesn't help it in that regard. The same is true of the D05, which has a flashy gold D-Pad and triggers.

Let's look at raw specs. The Steam Controller for $100 gets you TMR analogue sticks, extra custom buttons, dual trackpads, dual-stage magnetic triggers, gyro support, and a 35-hour battery life with a charging dock. This does beat out the Xbox pad and Sony's DualSense. But the EasySMX D10 gives you TMR sticks, a polling rate that is four times greater, linear Hall effect and non-linear micro switches, extra reprogrammable buttons, and (in my opinion) a nicer dock.

The GameSir G7 Pro offers everything the D10 has, but with a nicer feel and stronger build quality (and it's $20 less than the Steam Controller). Raw stats would matter little if they didn't have feel, but these controllers are great in that regard, too. These, and 8BitDo, all offer genuinely excellent-feeling controllers, equally matching the big dogs of the controller world.

This doesn't immediately make them better than the Steam Controller, but instead makes each choice viable. And that's what people miss when they overlook third-party controllers.

In the weeks since its launch, I've become more and more enamoured with the Steam Controller, and I may pick one up anyway, but that will be at least partially driven by what makes the controller unique, not what makes the controller unique when compared to a limited range.

I like its touchpads and gyro support. I think it seems genuinely pretty neat, and I like its ergonomics too. But its competition is wide, and only getting wider every day. And it especially makes sense to know what's out there when you're spending up to $100 on it. Still, the fact that the controller can sing is kinda cool.

I've got good news for many folks gaming on a Team Red rig: Microsoft's Advanced Shader Delivery is now supported by AMD RDNA 3, 3.5, and 4 GPUs. In other words, graphics cards from the Radeon RX 7000, 8000, and 9000 series now support this tech, via the latest Adrenalin drivers.

Advanced Shader Delivery was first announced back in 2025, exclusively for the ROG Xbox Ally and ROG Xbox Ally X handhelds. To put it very simply, rather than your game of choice taking its time to compile and cache shaders the first time you launch it, this tech does all of that before you ever hit 'play'—but only so long as you're downloading games via the Xbox app.

Microsoft previously explained it had "partnered with teams across Xbox and at AMD to precompile [shader] data and distribute it at download." If you fancy a more technical deep dive than this, the Unreal Engine tech blog has the goods. Now, PC gamers running Windows on AMD hardware, who are also Xbox Insiders, can enjoy the same freedom from long load times and stuttering on a selection of 'key titles' that support the tech.

A number of recent releases benefit from this rollout to laptops and desktops with discrete AMD GPUs. According to the DirectX Developer Blog, a close partnership with the Forza Horizon 6 development team means that the game "showcases the advantage of ASD by dramatically improving loading times by 95%" from day one. The team claims that, on a machine with an AMD Radeon RX 7600 GPU and an AMD Ryzen 7 5800 CPU, ASD reduces the game's first-time load from 1.5 minutes to 4 seconds.

This latest rollout is part of a 'public preview' for Xbox Insiders, and not every game supports the tech. A full list of titles available via Xbox Wire here; besides Forza 6, supported title highlights include Call of Duty: Black Ops 6, Clair Obscur: Expedition 33, Silent Hill f, and Ninja Gaiden 4. In-game, you'll see a tiny ‘Precompiled shaders installed’ message in the launch window of supported titles—but, much like the faster load times, it's very much 'blink and you'll miss it'.

The DirectX Dev blog post concludes with a 'call to action,' pointing game devs towards another post that "details how you can leverage the latest AgilitySDK to take advantage of the benefits of ASD." There are also plans to bring ASD to more devices, including an independent hardware vendor kit. Whether that means there are plans to bring ASD to GPUs besides anything on Team Red remains to be seen, though.

There's also currently no word on whether we'll see the streamlining shader tech come to Steam, Epic, or GOG. Presumably, any fresh implementation of the tech would still need to be tied to Microsoft's ecosystem, at least for the time being. Otherwise, freedom from long, first-time loads and shader stutter is why I'm happy to be a console gaming double agent.

Did Silksong kill the metroidvania? At least two high quality "search action" platformers released on Steam last week, but you might have struggled to learn about them amid the buzz around Subnautica 2, and the clamouring to find a new angle on Mixtape.

One is Shattered Divinities, an interesting Chinese-developed fantasy outing. The other is Clockwork Ambrosia, which I've played for about five hours. It's a gorgeous thing to see in action, with a lovingly detailed approach to pixel art reminiscent of Iconoclasts or Owl Boy. Its dreamy commingling of chrome-hued sci-fi with blue sky steampunk cheerfulness is a real pleasure to spend time with. It's unmistakably top tier gear.

Clockwork Ambrosia borrows a bit from Mega Man with its gun-centric combat, but adds a substantial modding system. Each of the four main weapons can be tweaked extensively with add-ons found throughout the world. Loot is abundant, and every chest tends to have something consequential inside: for example, a mod that lets me fire missiles vertically rather than horizontally, or a mod that splits my pulse rifle projectiles into three. Even in the first quarter of the game I found myself fiddling with my loadout a whole bunch, especially before boss encounters. In this way, it sometimes feels a bit like Armored Core.

I'd highly recommend Clockwork Ambrosia, and if it was released ten years ago I probably wouldn't feel so alone in my enthusiasm. But here we are: the metroidvania no longer has the currency it enjoyed back when the likes of Axiom Verge, Hollow Knight, Guacamelee, Ori, and Chasm were releasing at a steady clip at the end of the 2010s.

It doesn't even matter if the presentation is exceptional. I doubt many have heard of MIO: Memories in Orbit, or know that Grime got a sequel this year. These two, with Clockwork Ambrosia, are as good as anything released last decade (or indeed, in the '90s). MIO especially, has an art style that would have marketed itself, back when the genre was at its height.

Aside from Silksong, the last big metroidvania to hit the top 50 was Animal Well, which debuted at 10. Here are the others that managed to crack the top 50 easy done (Prince of Persia: The Lost Crown was an Epic Games Store and Ubisoft Store exclusive at launch, so it's not included):

It's not so unusual for styles to enjoy time in the sun before receding for a while. I doubt the current King's Field-like craze will last forever, and surely, surely, there's an end to all these retail simulators. If anything, the decline of the metroidvania—at least in terms of the buzz they can generate—demonstrates how risk prone and capricious indie development is. When Realmsoft launched the Kickstarter for Clockwork Ambrosia in 2018, the project would have looked like a deadset winner at a time when the genre was thriving.

How can a team predict genre fatigue nearly a decade before release? Modern indie development is still young enough for these long, arcing patterns to be mysterious. In 2026, not a single metroidvania has penetrated Steam's Weekly Seller chart, save for Hollow Knight: Silksong back in January.

Buzz or not, you should really check out Clockwork Ambrosia.

Top Steam games by revenue (May 5 - 12)

Steam releases its top sellers charts on Wednesdays, so the below chart doesn't factor in some late week releases that might have been big.

Forza Horizon 6 pre-sales are probably so high because the deluxe edition grants five days early access (starting May 15). I guess it demonstrates that these incentives work. As Jody Macgregor pointed out earlier today, it's hit a higher player count than its predecessor well before its wider release.

Subnautica 2 at number 4 is about what I would expect. It's not a reflection on sales per se (because the charts are at the mercy of heaps of other factors) but it's kinda funny to note that the most wishlisted game on Steam didn't chart as highly as Far Far West did the week before, or Windrose the week before that (the latter was the second top sellers in its launch week).

Last week's Steam deep cuts

Best Steam user review of the week

This game made me feel alive again.
I've been kicking, burning, netting, stabbing, slashing, and most of all kicking, burning, netting, stabbing, slashing and most of all kicking, burning, netting, stabbing, slashing and most of all kicking, burning, netting, stabbing, slashing, and most of all.... you get the point.
10/10

- Ikea Bean Cat on The Adventures of Sir Kicksalot

Earlier today, Brazilian tech outlet Tecnoblog published images of two unannounced Xbox controllers reportedly obtained from the country's telecommunications regulator. One is a small form factor gamepad designed for cloud gaming, resembling similar third-party gamepads by the likes of 8bitDo. The other is the successor to the Xbox Elite Controller 2.

I've been looking forward to news about this gamepad because, since the last iteration released in 2019, the whole landscape for gamepads has changed. Nowadays a third-party gamepad with all the pro accoutrements—rear paddle buttons, interchangeable D-pads, replaceable sticks—can be had for bargain prices, or at least, well below the Series 2's $180 going price. The Gamesir G7 Pro, for example, which is in some ways more feature-rich, goes for $80. What can a titan like Microsoft do to stand out?

Microsoft obviously hasn't announced this controller, we don't know its price, and we don't know the full extent of its features. But based on the images and Tecnoblog's intel from the regulator's documents, it's a curious beast, chiefly due to what resembles two scroll wheels on either side of the headphone jack.

What could these be for? Tecnoblog speculates they could be designed for flight sims, but that seems like an extremely niche focus: I reckon flight sim fanatics would prefer proper flight sim peripherals. How would they be implemented in far more mainstream games, like FPSes?

Here's two more images from Tecnoblog:

Based on the images alone, that's about as radical as the Elite 3 controller gets. Like the previous model it'll have interchangeable rear paddles, and swappable sticks and D-pads. That middle button just under the Xbox button switches between local and cloud modes, the latter connecting to Xbox Cloud Gaming servers. The battery is still rechargeable and replaceable albeit smaller.

One thing that's impossible to glean from the images is the thing that's most important. Will Microsoft implement drift-free Hall Effect technology in the analog sticks, thus eliminating the ever-present fear of stick drift? Or might they implement Tunnel Magnetoresistance (TMR) sticks, which are similarly drift-free, but marginally more accurate?

Let's be blunt: If they don't implement either it's a non-starter. As I've written before, in 2026 you should refuse to buy any controller that comes with the problems endemic to Sony, Xbox, and Nintendo's controllers. You can buy third-party Hall Effect controllers for a pittance nowadays.

I'm also—I won't lie—kinda bored by the Elite 3 controller. Why would I buy this instead of the Steam Controller which has those still severely underrated trackpads? Valve's controller has TMR sticks as well, and while its rear paddle buttons are baked in and there's only two of them, I reckon four paddle buttons is a more niche proposition than trackpads (time will prove me right!).

The smaller controller is very much a meat and potatoes affair: it's got all the usual features without any of the pro trimmings, it's remarkably small and designed for carrying around, and bears the same new toggle button beneath the Xbox button.

When will these be properly announced? Microsoft hasn't given any hints, but my best guess would be at its Xbox Games Showcase on June 7, which happens as part of Summer Game Fest 2026.

Forza Horizon 6 has been one of the top sellers on Steam since early April and it's not even out yet. As of April 15 it had reportedly been pre-purchased more than 500,000 times, and that's likely to have nearly doubled since, considering how steadfastly it has hovered around the top of Steam's weekly revenue charts.

It's a pretty astonishing figure but, for some context, Battlefield 6 was reportedly sitting on around 1.7 million pre-orders in the week before its October 10 launch.

I would never pre-order a digital game, but it's interesting to consider the reasons one would. All Forza Horizon 6 pre-orders get a bonus "Pre-Tuned Ferrari J50" which is hard for me to get excited about since the full game has over 500 cars. Pre-orders likely have much more to do with the $120 Premium version, which grants four days early access to the game and all future DLC.

The success of Horizon 6 sent me looking back through earlier Steam revenue charts to see if any other recent racing game has blown up to a similar extent, pre-orders or not. When was the last time a racing game managed to breach the top ten?

(I'm not going to include RV There Yet? or GTA 5, or RoadCraft, because while all have driving they're not strictly racing games).

• Sonic Crossworlds almost breached the top ten during its launch week (it released September 25, 2025), coming in at 11 behind the likes of Megabonk, Dying Light: The Beast and Silent Hill f.
• F1 25 hit number 5 during its launch week—it launched on May 31, 2025.
• Tokyo Xtreme Racer hit number 11 during its launch into early access on January 23, 2025, but failed to breach the top 20 when it launched out of early access on September 25, 2025.
• Assetto Corsa Evo hit number 6 during its launch week—it launched on January 7, 2025.

I'm most surprised that Tokyo Xtreme Racer never managed to breach the top ten: it was definitely the most talked about racer of 2025. Still, it hardly has the brand power of Sonic or F1.

What I'm not generally surprised about is that few new racing games do penetrate the top ten. Screamer has had great reviews and looks fun, but didn't manage. The same is true for stuff like Carmageddon: Rogue Shift, Ride 6 and MotoGP 26. If you lived through the '90s and early '00s you probably still see racing games as being one of the medium's key genres but they really just aren't anymore, save obvious exceptions like Mario Kart and, well, Forza Horizon.

And even when they sell remarkably well, racing games tend not to dominate the discussion for long, if at all. We'll probably see a bunch of vertical video showing off Horizon 6's truncated take on Japan next week, but no one's going to be arguing about it (like they presently are Mixtape). Also, considering how very similar Forza Horizon 6 is to previous Forza Horizon games, there's probably not a great deal to talk about anyway (but maybe I'm wrong!).

With big names like Need for Speed, Ridge Racer, Driver, and GRID feeling more and more like ancient curios, Forza Horizon is probably the only multi-platform racer that everyone will buy. But even if it released into a busier month—and there's basically no other blockbuster games releasing for the rest of May—I don't think Forza Horizon 6 will take up much mindshare.

Will I be playing it? You bet, but while listening to a podcast.

Top Steam games by revenue (April 28 - May 5)

Steam releases its top sellers charts on Wednesdays, so the below chart doesn't factor in some late week releases that might have been big, including Mixtape.

It's interesting that the Steam Controller doesn't factor into the top 100. It released on May 4, a day before the cut off for last week's revenue chart. Considering how quickly it sold out, I'm surprised that it doesn't appear at all whereas the Steam Deck does (at number 86). Is it possibly a hint regarding how few Steam Controllers Valve actually had to hand? Whatever the case, if you want one now you have to join a queue.

Last week's Steam deep cuts

Best Steam user review of the week

Here I will leave the cat, friends who pass by can pet it and give it a thumbs up
　　　 　　／＞　　フ
　　　 　　| 　　 l
　 　　 　／` ミ＿xノ
　　 　 /　　　 　 |
　　　 /　 ヽ　　 ﾉ
　 　 │　　|　|　|
　／￣|　　 |　|　|
　| (￣ヽ＿ヽ)__)

- Zhain on Holy Grail for Dummies

A game designer, producer, and director who had a hand in developing games like System Shock, Terra Nova, and Flight Unlimited, Seamus Blackley is best known as the "father of the Xbox" after proposing and spearheading the creation and design of the Microsoft console's first iteration. Blackley left Microsoft in 2002, but he was recently invited back to Microsoft HQ for a visit by Xbox's new CEO, Asha Sharma.

In a recent series of posts on Bluesky describing the "amazing—and yet very bizarre—experience of going to Xbox HQ as a visitor," Blackley shared the most important thing he did during his return to the Microsoft fiefdom: Gathering some wild yeast. You know, for bread.

"Amidst the cognitive dissonance of huge buildings and thousands of employees existing as a result of what in my memory is still just a bad slide deck written on a red-eye flight, I decided to ground myself before the meeting by, of course, COLLECTING WILD YEAST on the Microsoft campus," Blackley wrote. "As one does."

While history will doubtless remember Blackley for irrevocably altering the course of the games industry and its technology, his online presence in recent years has featured a different craft: Ancient breadmaking techniques. His exploits have ranged from lengthy demonstrations on collecting and cultivating wild yeast to recreating an ancient Egyptian bread recipe using yeast extracted from 4,500 year old pottery.

His visit to the Microsoft campus, therefore, presented an opportunity to create another unique loaf. Despite his fears that security might object to, as he described it, "this strange man rooting about in the landscaping pulling jars of shit out of his bag," he was able to leave open containers of gloop on the premises for the duration of his Xbox appointment.

"The deal with collecting wild sourdough microbes is that you put a container of sterilized food (flour) out, and leave it to get contaminated wherever you think interesting microflora might be lurking," Blackley explained. "I mean, microflora? It has to be interesting. Right? Anyway nobody stole it so I took it home."

An indictment of Microsoft security's rigor, perhaps, but a success for traditional breadmaking everywhere.

After passing through airport security unquestioned while in possession of a biologically active mystery paste—raising yet more questions about security standards—Blackley returned home with his Microsoft yeast, where after a week of "thrilling" cultivation he produced a 100% whole wheat, artisanal, Xbox-campus-to-table sourdough loaf.

Yes, it looks like the Xbox logo. You score sourdough loaves to enable a consistent, controlled rise, and if you score a cross it looks like an X. That's the joke.

We can only guess what Blackley's conversation with Xbox's new CEO consisted of, but he said Sharma is "very cool it turns out"—a markedly more positive assessment than the one he shared in February, where he predicted she'd serve as "a palliative care doctor who slides Xbox gently into the night."

Earlier today, Sharma announced that Xbox would be ending console development of Copilot while simultaneously welcoming four executives from Microsoft's CoreAI product division into key Xbox leadership roles. So, you know. Jury's still out.

A CNBC report says there's been a significant leadership shakeup at Microsoft's Xbox division, and if you're not a fan of AI then you might want to avert your eyes. Xbox CEO Asha Sharma, who came into the role in February after spending two years as president of Microsoft's CoreAI Product division, has tapped at least four of her former CoreAI fellows for key roles in Xbox leadership.

Jared Palmer, formerly vice president of CoreAI (and, prior to that, vice president of AI at AI company Vercel), is the new vice president of engineering at Xbox, and a technical advisor to Sharma. In a memo sent to employees, Sharma said Palmer will work "directly with me on our most complex product and engineering problems, with a focus on developer tooling, taste, and infrastructure."

Tim Allen, senior vice president of CoreAI Design, will lead design at Xbox, "bringing together product design, design engineering, research, and creative with a fan-first focus." Former CoreAI head of growth Jonathan McKay will take on a similar role at Xbox, while former CoreAI general manager Evan Chaki will lead a new "forward-deployed engineering group focused on removing repetitive work, simplifying development, and improving how we operate."

At least one non-Microsoft executive has also been brought aboard the good ship Xbox: David Schloss, previously the senior director of product growth at Instacart, is now head of subscriptions and cloud at Xbox.

"We need to evolve how we work and how we are organized across our platform," Sharma wrote in the memo. "Right now, it is too hard to ship impact quickly. We spend too much time inward instead of with the community, and we lack the depth we need in some of the fundamentals."

Palmer confirmed his move on X, where he said he'll be "focused on building world-class tools, services, and experiences for developers and players across the Xbox ecosystem." An Xbox representative confirmed with PC Gamer that the CNBC report is accurate.

That's a lot of AI horsepower at the top of Xbox, although I wouldn't read too much into it at this point. Talking about "removing repetitive work" and "ship[ping] impact quickly," whatever that means, certainly has a whiff of the ol' AI will save us, but it's not uncommon for executives taking new roles to bring people they're familiar with along with them—and that's doubly true in cases where the previous leader's strategy has been discredited and abandoned, as is this case here.

And in her own message on X confirming the changes, posted a few hours after the Xbos leadership shakeup was first reported, Sharma suggested that Xbox is actually moving back from its focus on AI, or at least slowing it down.

"Xbox needs to move faster, deepen our connection with the community, and address friction for both players and developers," Sharma wrote. "Today, we promoted leaders who helped build Xbox, while also bringing in new voices to help push us forward. This balance is important as we get the business back on track.

"As part of this shift, you’ll see us begin to retire features that don’t align with where we’re headed. We will begin winding down Copilot on mobile and will stop development of Copilot on console."

Ending Copilot AI development on Xbox while simultaneously bringing a bunch of CoreAI guys onto the Xbox leadership team is a surprise twist, and I'm really not sure what to make of it—except that it could be read as Microsoft being pretty serious about an Xbox turnaround: It recognizes that Xbox customers aren't happy, it's got at least some idea as to why, and it's committed to doing something about it.

But it could also be taken as merely going with the broader flow at Microsoft, which has recently dialed back on the presence of Copilot in Photos, Notepad, and other elements of Windows. But Microsoft also recently renamed Office to the "Microsoft 365 Copilot app." Make of it what you will, I guess.

Sharma has wasted no time putting her stamp on the post-Phil Spencer Xbox world. Along with ending the maligned "This is an Xbox" marketing campaign, she's also overseen a reduction in Game Pass prices (and services) and acknowledged that Microsoft just doesn't have the juice when it comes to PC gaming; at the end of April, after less than three months in the job, Sharma said "player and revenue growth has not yet met our ambition." Given all that, it's clear that Xbox isn't as dead as Seamus Blackley predicted, but I have no doubt we'll be seeing even more big changes coming in the future.

Microsoft announced in March that the new Xbox mode for Windows 11, a full-screen "dedicated gaming experience," was set to go live in April. And on the very final day of the month, with most of those last 24 hours already gone, it's finally starting to happen.

"Beginning today, we’re excited to share that Xbox mode will begin rolling out in select markets to Windows 11 PCs, including laptops, desktops, and tablets, bringing a console-inspired Xbox experience to more players than ever," Microsoft VPs Jason Ronald and Ian LeGrow said in a joint statement.

"Whether you’re playing on a high-performance desktop, a gaming laptop, or a Windows handheld, Xbox mode makes it easier to jump into your games. It adds another way to enjoy games on your PC—with a controller-optimized, full screen experience that is built for play."

Which markets have been selected for the initial rollout is a closely held secret: If you want to know whether you're in one of them, set Windows 11 to download and install updates as soon as they're available, and then wait to see if it downloads and installs anything. If it does, congratulations: You're in the club!

And what does that membership get you? "Xbox mode is designed for the moments when you want your games to take center stage on Windows 11 PCs and handhelds," the veeps explained. "Inspired by the Xbox console experience, Xbox mode offers a streamlined interface that puts your library and recently played titles within easy reach while minimizing background distractions."

In practical terms, Xbox mode enables users to:

• Browse and launch games using a controller optimized interface.
• Jump back and forth between Xbox mode and the Windows 11 desktop whenever you want.
• Access an aggregated game library, including the full games catalog from Xbox Game Pass, and installed games from leading PC storefronts.

Like PC Gamer hardware writer James Bentley, I don't see any value to this on a personal level: For conventional sitting at your desk PC use (which I maintain is the only proper kind of PC use), mouse and keyboard just isn't going to be beat.

But for PC gaming from the couch (or bed, as the case may be), a controller is clearly a better option—and also entirely unsuitable for the standard Windows interface. So, much like Steam's Big Picture mode, I can see where there's a place for this sort of thing, even if I'll never use it myself.

For Microsoft, the new Xbox mode is one piece of a bigger puzzle: "To make Xbox feel consistent across screens while giving you more choice in how and where you play."

"Windows has long been an important part of the PC gaming ecosystem, supporting innovation through its open platform. Together with Windows, Xbox is taking everything we’ve learned about building a world-class operating system for gaming and continuing to evolve the experiences that meet players where and how they choose to play."

Of course, this is far from the first time Microsoft has committed itself to becoming a driving force in PC gaming. And, as I said last week when Xbox CEO Asha Sharma and CCO Matt Booty shared their own commitment to gaming on PC, it has never, in the Xbox era, added up to anything. Even today, the Xbox experience on PC sucks: I've recently been playing Sea of Thieves with my PC Gamer pirate pals, using the Microsoft Store edition of the game, and it works but it feels decidedly cumbersome and unfriendly compared to the point-and-shoot simplicity of Steam.

That can be turned around, and this new Xbox mode might be the first step in that process, but whether Microsoft has the commitment and will to make it happen, we'll have to wait and see.

Microsoft released its Q3 FY26 earnings report yesterday, and the news on the Xbox is not entirely sunshine and lollipops. The company ate a 7% ($380 million) decrease in gaming revenue in the quarter, driven by a 5% year-over-year decline in Xbox content and services revenue and a 33% drop in Xbox hardware revenue.

That's not catastrophic, but it was enough to prompt a public reaction from new Xbox CEO Asha Sharma. "While we have made progress expanding the business and our margins, player and revenue growth has not yet met our ambition," Sharma wrote on X. "We know we have work to do to earn every player today and into the future."

CEOs are paid to say upbeat things about downbeat situations, but even knowing that, Sharma's statement hits me as a bit overwrought—or maybe just unnecessary and misplaced. She only took the CEO job a little over two months ago, and given the near-universal agreement that Xbox has been in decline for some time now, I'd be very surprised indeed if Microsoft's ambitions for player and revenue growth had already been met. Microsoft literally just gave up on the "This is an Xbox" campaign last month. It takes a while to turn these ships around, you know.

Microsoft CEO Satya Nadella came off as a little more circumspect about the whole thing in his own comments during the company's earnings call, saying Microsoft is "doing the foundational work required to win back fans and strengthen engagement across Windows, Xbox, Bing, and Edge," and that the Xbox team in particular "is recommitting to our core fans and players, and shaping the future of play." He also noted that the quarter saw "new records for monthly active Xbox users" and game streaming hours.

At the same time, Nadella cautioned Xbox fans not to expect a big turnaround anytime soon. "In Xbox content and services, we expect revenue to decline in the low-teens, reflecting a prior year comparable that benefited from strong first-party content, as well as the recent price changes for Xbox Game Pass as we focus on delivering more value to gamers," Nadella said during the call. "Hardware revenue should decline year-over-year."

Don't feel too bad for Microsoft, though. The company pulled in $82.9 billion over the quarter—that's right, just three months—representing a year-over-year growth of 18%, while profit—again, for just a three-month stretch—hit $31.8 billion, a 23% increase.

Microsoft's brutal rash of layoffs and studio closures after the acquisition of Activision Blizzard for $68.4 billion is something of a grave marker in the industry, sweeping promising projects under the rug. One of those was Project Blackbird, an MMO by Elder Scrolls Online developers Zenimax Online Studios, which had been in production since 2018.

It also saw the departure of Matt Firor, founder of ZoS and director of the very same MMO. In a recent interview with MinnMax, Firor was asked about how he feels nearly one year on: "I think it's a missed opportunity for me, for ZoS, for Bethesda, for Xbox, I think it would've been a fantastic game."

It's not just him, either. One of the more baffling things about Blackbird is how well-regarded it was internally, with Xbox head honcho Phil Spencer reportedly having to be pulled away from the thing. Firor adds: "You could be at the best studio in the world, and decisions happen that impact people."

However, the crushing weight of big business consumes all: "We're a number on a ledger, and if that number is large, it is ripe for analysis, shall we say. And that number was always large, and over the years we always explained why we were frontloading a lot of costs and what they were gonna get for it."

Earlier in the interview, Firor says the idea with Blackbird was always to build for the future—frontloading costs on systems that would make maintenance and development easier down the line. This is unpopular in the age of shareholders.

"It looked to the people there—and elsewhere in the industry—that that was just a very large bet, and they needed to hedge their large bets."

Firor shows enviable composure and professionalism in regards to the people working at Xbox themselves, though:

"In general, the people at Xbox were awesome—it's not a personal vendetta or anything, everyone there was mostly good to interact with on the human level. It's just: Big business is big business. Microsoft is Microsoft, right? And a giant successful videogame on the Microsoft level was frankly not that stimulating to them.

"They want a business they can look at that has numbers that go up reliably every year by a certain amount—and this isn't [just] Xbox, this is all public companies, they want reliable, forecastable business … I don't agree with some of the decisions obviously, but the reasoning behind them make sense on a ledger somewhere."

Oof, if that doesn't feel like a tone-setting statement for the last few years. It's as though you can be laid off for blinking or breathing in the videogame industry nowadays—make a good game, make a bad one, it doesn't seem to matter. Firor seems optimistic as he closes out the interview, though: "There's a hell of a lot of good people out there that don't have jobs right now, that can assemble very many very good teams, and I know that for a fact."