Fears for Xbox as it puts its developers on the chopping block once again
Summary
Xbox, owned by Microsoft, plans to close three game studios—Ninja Theory, Double Fine, and Compulsion Games—to reduce costs after several years of falling revenue. This move follows a memo from new Xbox leaders warning that the company had expanded too much and must "reset" to address financial and industry challenges.Key Facts
- Xbox announced plans to shut down three game studios: Ninja Theory, Double Fine, and Compulsion Games.
- These studios are known for creative, award-winning games like Hellblade, Psychonauts, and South of Midnight.
- Xbox leaders said they spent over $20 billion in five years but revenue dropped by nearly $500 million.
- The closure news came shortly after a big Xbox event showcasing new game releases.
- Employees from the affected studios posted that they are looking for new jobs.
- The Xbox memo said the company expanded its studios too much to support multiple strategies but must now reduce costs.
- Microsoft’s recent profits totaled $217.4 billion, despite Xbox’s financial struggles.
- Xbox’s head and chief of staff recently resigned, possibly related to the studio closures.
- This is part of a pattern, as Xbox shut other studios and cut 9,000 jobs in 2024 and 2025.
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