Is the long expected Xbox death upon us?

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10:45a, 6/30/26
AG


I know many have speculated MS would get out of the console HW business and focus on SW, but this sounds even more impactful although I can't tell if this means a new console is dead or not.

Studio closures and mass layoffs. I wonder if this will actually be a good thing...
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agdoc2001
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10:55a, 6/30/26
AG
Caused by an Indian? What a weird quote/take. She took over for Phil Spencer like 4 months ago
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In reply to agdoc2001 • 12:31p, 6/30/26
AG
agdoc2001 said:
Caused by an Indian? What a weird quote/take. She took over for Phil Spencer like 4 months ago


Yeah, I know nothing about that. Maybe she was brought in to be the hatchet lady. Dunno.

Was focused more on the other information shared since it's been speculated for some time that Xbox might go away.
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Quad Dog
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2:24p, 6/30/26
AG
There may not be a next generation console from anyone. The popularity of PC gaming, Steam, cost of processors, etc. Might have killed all future consoles that aren't something like the Switch.
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jr15aggie
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2:54p, 6/30/26
AG
I'm not cheering mass layoffs, but some of these developers had become so bloated with people that they couldn't get anything done. Independant developers have started lapping these larger firms.

It looks to me like they are trying to get back to smaller / more focused dev teams and anybody with purple hair and a DEI agenda can take a hike.
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jr15aggie
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3:03p, 6/30/26
AG
And with regard to the OP... this is Phil Spencer's mess. I really liked Phil and his vision when he took over for Xbox. It was all going pretty well but he appeared to lose control during the rise of Covid and peak craziness of DEI. Phil is one of many executives (in the entertainment industry) that watched profits plummet.

I don't know much about Asha, but she appears to be doing the necessary things to try and get Xbox back on track.
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In reply to jr15aggie • 3:59p, 6/30/26
AG
jr15aggie said:
I'm not cheering mass layoffs, but some of these developers had become so bloated with people that they couldn't get anything done. Independant developers have started lapping these larger firms.

It looks to me like they are trying to get back to smaller / more focused dev teams and anybody with purple hair and a DEI agenda can take a hike.


Yes, this might actually be a good thing. I've certainly not noticed a dropoff in games in the last couple of years. The number of indie developers these days is staggering. Maybe one could argue the release frequency of big AAA titles has fallen off? But I'm not sure that's even true.
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AggiEE
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In reply to Quad Dog • 11:11p, 6/30/26
Quad Dog said:
There may not be a next generation console from anyone. The popularity of PC gaming, Steam, cost of processors, etc. Might have killed all future consoles that aren't something like the Switch.


This is a very strange take considering component prices impact PC parts more than anyone else.

Cross-gen will be a thing though, just like it is for PC users since there's no established gens there. But 70% of PC gamers are playing on a device less powerful than a PS5.

PS6, etc, will just be an enthusiast option but PS5 audiences aren't going to get left behind with any genuine PS6 exclusives for a very long time.
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AggiEE
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11:15p, 6/30/26
Xbox is in an unrecoverable position, and it's hard to take anything their leadership says seriously.

On the one hand, Asha is talking to the media saying that her mandate isn't to a profitability margin, but rather to be the largest gaming company by 2030.

Well, you don't become the largest gaming company by massively shrinking and gutting your studios.

They have also revealed 2 games a few weeks ago for a 2027 release that are now going to have their studios shut down. The optics of this are just horrific. They really do not have a clue, and it's clear that Asha is an outsider in a very bad way. She's way over her head.

So yeah, it seems to me like they are just dragging out the Xbox's demise at this point. Asha seems to be coming into cut the company up and potentially sell it off. Their lack of long-term vision and commitment combined with flip-flopping strategies and executive doublespeak just spell out that they have no clue what they are doing.

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flakrat
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11:43p, 6/30/26
AG
I don't know what the answer is, but I believe that a mixed PC, Xbox and PS ecosystem is good for the fans and b usiness.

However, I'm in the super computing biz, and only a PC gaming fan watching this from the sidelines.

Full disclosure, I came to the Nerdery tonight looking for the Steam Summer Sale thread :-)
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MGS
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8:16a, 7/1/26
Yeah, this is all Phil Spencer's mess.

Somebody needed to tell Todd Howard that it's a business - It shouldn't take 20 years to release a new Elder Scrolls game and Microsoft missed a great opportunity by not having a new Fallout game to coincide with the TV show.
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HossAg
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In reply to jr15aggie • 8:21a, 7/1/26
AG
jr15aggie said:
And with regard to the OP... this is Phil Spencer's mess. I really liked Phil and his vision when he took over for Xbox. It was all going pretty well but he appeared to lose control during the rise of Covid and peak craziness of DEI. Phil is one of many executives (in the entertainment industry) that watched profits plummet.

I don't know much about Asha, but she appears to be doing the necessary things to try and get Xbox back on track.

It's definitely Phil's mess. Asha has been doing a good job since she took over.
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AggiEE
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In reply to HossAg • 10:01a, 7/1/26
HossAg said:
jr15aggie said:
And with regard to the OP... this is Phil Spencer's mess. I really liked Phil and his vision when he took over for Xbox. It was all going pretty well but he appeared to lose control during the rise of Covid and peak craziness of DEI. Phil is one of many executives (in the entertainment industry) that watched profits plummet.

I don't know much about Asha, but she appears to be doing the necessary things to try and get Xbox back on track.

It's definitely Phil's mess. Asha has been doing a good job since she took over.


How has she done a good job?
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jr15aggie
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In reply to HossAg • 10:13a, 7/1/26
AG
I'm just curious how much / how little control Phil actually had on any of this.

One example... just how exactly did South of Midnight take 5+ years and 100 million dollars to make!?! I swear a massive segment of the entertainment industry is nothing but a money laundering scheme. There is just no way intelligent people hell bent on making money let this stuff go on year after year.
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HossAg
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In reply to AggiEE • 11:11a, 7/1/26
AG
AggiEE said:
HossAg said:
jr15aggie said:
And with regard to the OP... this is Phil Spencer's mess. I really liked Phil and his vision when he took over for Xbox. It was all going pretty well but he appeared to lose control during the rise of Covid and peak craziness of DEI. Phil is one of many executives (in the entertainment industry) that watched profits plummet.

I don't know much about Asha, but she appears to be doing the necessary things to try and get Xbox back on track.

It's definitely Phil's mess. Asha has been doing a good job since she took over.


How has she done a good job?

It's not like she's had much time on the job, but she immediately changed the branding back to the OG style that people prefer. She also basically killed their AI initiative and removed the integration of that from xbox. Also lowered price of game pass I believe.

I think a lot of these layoff and cost cutting changes were inevitable with how things are going, regardless of who's leading.
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HossAg
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In reply to jr15aggie • 11:12a, 7/1/26
AG
jr15aggie said:
I'm just curious how much / how little control Phil actually had on any of this.

One example... just how exactly did South of Midnight take 5+ years and 100 million dollars to make!?! I swear a massive segment of the entertainment industry is nothing but a money laundering scheme. There is just no way intelligent people hell bent on making money let this stuff go on year after year.

I heard they spent 300 million on the new gears game. How the hell they expect to make even close to that, I have no idea.
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Tex117
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11:18a, 7/1/26
AG
Wait, none of yall have looked at how ridiculous that guys tweet is saying that GamerGate gave us Trump?

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YouBet
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In reply to HossAg • 12:34p, 7/1/26
AG
HossAg said:
AggiEE said:
HossAg said:
jr15aggie said:
And with regard to the OP... this is Phil Spencer's mess. I really liked Phil and his vision when he took over for Xbox. It was all going pretty well but he appeared to lose control during the rise of Covid and peak craziness of DEI. Phil is one of many executives (in the entertainment industry) that watched profits plummet.

I don't know much about Asha, but she appears to be doing the necessary things to try and get Xbox back on track.

It's definitely Phil's mess. Asha has been doing a good job since she took over.


How has she done a good job?

It's not like she's had much time on the job, but she immediately changed the branding back to the OG style that people prefer. She also basically killed their AI initiative and removed the integration of that from xbox. Also lowered price of game pass I believe.

I think a lot of these layoff and cost cutting changes were inevitable with how things are going, regardless of who's leading.


Actually, it went up double. It's the reason I cancelled it and moved over to PS at end of last year. Unless she just lowered it back down in last couple of months?
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HossAg
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In reply to YouBet • 1:53p, 7/1/26
AG
YouBet said:
HossAg said:
AggiEE said:
HossAg said:
jr15aggie said:
And with regard to the OP... this is Phil Spencer's mess. I really liked Phil and his vision when he took over for Xbox. It was all going pretty well but he appeared to lose control during the rise of Covid and peak craziness of DEI. Phil is one of many executives (in the entertainment industry) that watched profits plummet.

I don't know much about Asha, but she appears to be doing the necessary things to try and get Xbox back on track.

It's definitely Phil's mess. Asha has been doing a good job since she took over.


How has she done a good job?

It's not like she's had much time on the job, but she immediately changed the branding back to the OG style that people prefer. She also basically killed their AI initiative and removed the integration of that from xbox. Also lowered price of game pass I believe.

I think a lot of these layoff and cost cutting changes were inevitable with how things are going, regardless of who's leading.


Actually, it went up double. It's the reason I cancelled it and moved over to PS at end of last year. Unless she just lowered it back down in last couple of months?

It was reduced again in April.
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YouBet
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In reply to HossAg • 2:19p, 7/1/26
AG
HossAg said:
YouBet said:
HossAg said:
AggiEE said:
HossAg said:
jr15aggie said:
And with regard to the OP... this is Phil Spencer's mess. I really liked Phil and his vision when he took over for Xbox. It was all going pretty well but he appeared to lose control during the rise of Covid and peak craziness of DEI. Phil is one of many executives (in the entertainment industry) that watched profits plummet.

I don't know much about Asha, but she appears to be doing the necessary things to try and get Xbox back on track.

It's definitely Phil's mess. Asha has been doing a good job since she took over.


How has she done a good job?

It's not like she's had much time on the job, but she immediately changed the branding back to the OG style that people prefer. She also basically killed their AI initiative and removed the integration of that from xbox. Also lowered price of game pass I believe.

I think a lot of these layoff and cost cutting changes were inevitable with how things are going, regardless of who's leading.


Actually, it went up double. It's the reason I cancelled it and moved over to PS at end of last year. Unless she just lowered it back down in last couple of months?

It was reduced again in April.


Gotcha. They must have bled off a huge number of subs when they did that to bring price back down.
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AggiEE
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In reply to YouBet • 4:34p, 7/1/26
YouBet said:
HossAg said:
YouBet said:
HossAg said:
AggiEE said:
HossAg said:
jr15aggie said:
And with regard to the OP... this is Phil Spencer's mess. I really liked Phil and his vision when he took over for Xbox. It was all going pretty well but he appeared to lose control during the rise of Covid and peak craziness of DEI. Phil is one of many executives (in the entertainment industry) that watched profits plummet.

I don't know much about Asha, but she appears to be doing the necessary things to try and get Xbox back on track.

It's definitely Phil's mess. Asha has been doing a good job since she took over.


How has she done a good job?

It's not like she's had much time on the job, but she immediately changed the branding back to the OG style that people prefer. She also basically killed their AI initiative and removed the integration of that from xbox. Also lowered price of game pass I believe.

I think a lot of these layoff and cost cutting changes were inevitable with how things are going, regardless of who's leading.


Actually, it went up double. It's the reason I cancelled it and moved over to PS at end of last year. Unless she just lowered it back down in last couple of months?

It was reduced again in April.


Gotcha. They must have bled off a huge number of subs when they did that to bring price back down.


They also removed Call of Duty and it's still more expensive than prior to the price hikes
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AggiEE
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In reply to HossAg • 7:08p, 7/1/26
HossAg said:
AggiEE said:
HossAg said:
jr15aggie said:
And with regard to the OP... this is Phil Spencer's mess. I really liked Phil and his vision when he took over for Xbox. It was all going pretty well but he appeared to lose control during the rise of Covid and peak craziness of DEI. Phil is one of many executives (in the entertainment industry) that watched profits plummet.

I don't know much about Asha, but she appears to be doing the necessary things to try and get Xbox back on track.

It's definitely Phil's mess. Asha has been doing a good job since she took over.


How has she done a good job?

It's not like she's had much time on the job, but she immediately changed the branding back to the OG style that people prefer. She also basically killed their AI initiative and removed the integration of that from xbox. Also lowered price of game pass I believe.

I think a lot of these layoff and cost cutting changes were inevitable with how things are going, regardless of who's leading.


I don't think she killed the AI initiatives it all, she comes from an AI background and wants to push AI in game development (which I don't necessarily disagree with as long as its done the correct way).

The branding move? Xbox to XBOX....no difference really.

She's also done some baffling decisions like going back on excusives for a few random weird games that are just going to flop now, while in the background also laying off tons of devs which is a contradicting strategy.

I don't think she'll be in this position very long. She's brought into slice up the company and do things the audience will hate, while getting cheap wins (XBOX and returning to exclusives) in order to lessen the sting of what she's doing to the hardcore faithful.
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YouBet
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9:43a, 7/6/26
AG
As expected, layoffs are announced:

Quote:
The company will lay off 1,600 people this week and 1,600 more during the rest of the fiscal year that began this month, Xbox Chief Executive Asha Sharma said in a memo to staff Monday. Those cuts represent about one-fifth of the division's total head count.

In addition, Microsoft is selling or spinning off four game development studios and exploring strategic options for a fifthmoves that will take more than 350 additional people off its payroll.


Uh, they missed their GamePass sub goals by....a lot.

Quote:
The company had projected Game Pass subscriptions would reach around 77 million this year, according to a document revealed during legal proceedings related to the Activision acquisition. It currently has about 30 million, a person familiar with the matter said.


I like this note on Fallout if they don't f* it up.

Quote:
Sharma is cutting the number of games Microsoft publishes and is investing more in its most popular franchises, including Minecraft, Candy Crush and Fallout. She reduced the price of Game Pass, which lost subscribers following a hike last year, and stopped putting new "Call of Duty" games on the service so gamers would have to buy them.


Sounds like they are trying to go the Steam route:

Quote:
Xbox also operates a digital game store for Windows PCs. As the company makes fewer games of its own, Sharma is trying to make Microsoft a more attractive distributor for the growing universe of independent game developers.
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Claude!
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9:49a, 7/6/26
Microsoft has tried several times to dive into the PC distribution world (remember Games for Windows Live? Neither does anyone else). It's never succeeded.
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Claude!
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10:32a, 7/6/26
I also wonder how much of these problems are related to poor management by Microsoft versus poor management by the individual studios.
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In reply to Claude! • 10:37a, 7/6/26
AG
Claude! said:
Microsoft has tried several times to dive into the PC distribution world (remember Games for Windows Live? Neither does anyone else). It's never succeeded.


Almost feels like Xbox is headed the way of Windows phone OS.
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aezmvp
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In reply to YouBet • 12:20p, 7/6/26
YouBet said:
Claude! said:
Microsoft has tried several times to dive into the PC distribution world (remember Games for Windows Live? Neither does anyone else). It's never succeeded.


Almost feels like Xbox is headed the way of Windows phone OS.
Talked with a friend who worked in the Xbox group for a few years starting in 19 and going through 22. The thing he consistently stressed is that the Xbox executive group viewed Xbox as an extension of windows and that the directives given to development groups largely reflected this and their view of the user experience was incredibly divorced from how console gamers game. Very little concern for experience and lots of concern for integrating it into your PC. Which makes very little sense. Especially for 20 and 21.

Im not surprised that they couldn't figure out the games cycle with these companies and are dying, it seems like the focus was on Redmond and not on the end user.
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Claude!
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1:32p, 7/9/26
Rumors indicating that Obsidian had their Avowed sequel canceled in favor of making a new Fallout game to be directed by Josh Sawyer (who directed New Vegas for Obsidian years ago).
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In reply to Claude! • 1:52p, 7/9/26
AG
Claude! said:
Rumors indicating that Obsidian had their Avowed sequel canceled in favor of making a new Fallout game to be directed by Josh Sawyer (who directed New Vegas for Obsidian years ago).

This would align with quote I shared previously:

Quote:
Sharma is cutting the number of games Microsoft publishes and is investing more in its most popular franchises, including Minecraft, Candy Crush and Fallout.

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htownag08
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2:36p, 7/9/26
AG
I have been on Xbox for years - gamer dad so I only play a few hours a week at best.

Consoles have always made the most sense for me - cheaper and I can always find games to play at a discount since i'm usually buying older ones. Occasionally get the new shooter to play with other gamer dad friends, but that's about it.

I feel like going the PC route is inevitable.
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YouBet
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In reply to htownag08 • 2:41p, 7/9/26
AG
htownag08 said:
I have been on Xbox for years - gamer dad so I only play a few hours a week at best.

Consoles have always made the most sense for me - cheaper and I can always find games to play at a discount since i'm usually buying older ones. Occasionally get the new shooter to play with other gamer dad friends, but that's about it.

I feel like going the PC route is inevitable.


I saw some analysis out there that PC gaming has actually ascended again and is more popular than consoles now. We've gone full circle.

There were several reasons given but QOL improvements like being able to use an Xbox controller (or PS controller?) with almost any PC game now and not have to use K&M certainly helps.
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Tailgate88
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5:25a, 7/10/26
AG
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jr15aggie
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In reply to Tailgate88 • 7:18a, 7/10/26
AG
That's the kind of stuff that will turn me away from Xbox real fast.

Using AI and cheap foreign labor so that corps can increase margins is terrible for the middle class.
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YouBet
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In reply to jr15aggie • 9:25a, 7/10/26
AG
jr15aggie said:
That's the kind of stuff that will turn me away from Xbox real fast.

Using AI and cheap foreign labor so that corps can increase margins is terrible for the middle class.


What I haven't been able to discern is if the reported 5k H1Bs were filed for the Xbox division or just MS overall. If it turns out that these 5k H1Bs are for Xbox and then fired 3,200 others to be replaced by H1Bs, I will then sell my Xbox and never look back.
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Aggie71013
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In reply to YouBet • 10:50a, 7/10/26
AG
Almost guaranteed this is for MSFT as a whole and a rage bait tweet. Every tech company has a massive amount of H1Bs so everyone would have to stop using tech to avoid supporting this.

Also guarantee the 3200 were not all US citizens. Every tech layoff I see H1Bs on LinkedIn that were laid off.
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