Xbox is reportedly in the midst of a substantial restructuring under new CEO Asha Sharma, with numerous reports detailing potential layoffs, studio closures, and the suspension of third-party deals. This comes after a period of leadership changes and a mixed reception to recent strategic shifts. The changes appear to be part of a broader effort to "reset" Xbox operations over the next 100 days, citing revenue concerns, rising hardware costs, and overexpansion.
Recent developments include the reported termination of a relationship with IO Interactive concerning its original IP, Project Fantasy. This decision may lead to staffing adjustments at the developer. Further casting a shadow over Xbox's internal development is a report from The Verge suggesting that Arkane Studios, known for titles like Dishonored and Deathloop, could be shut down. This potential closure would also mean the cancellation of Arkane's upcoming Marvel's Blade game, which has allegedly seen its ship date pushed to late 2027.
Meanwhile, GamesBeat has reported that Undead Labs, the studio behind State of Decay 3, is also facing potential closure, alongside Compulsion Games, Double Fine, and Ninja Theory. Compulsion Games was noted for its work on South of Midnight, Double Fine for the Psychonauts series, and Ninja Theory for the Hellblade games, with a new trailer for Senua having recently debuted.
Third-party developers have also indicated a halt in negotiations for Game Pass deals. According to consultant Fernando Rizo, Xbox has suspended discussions with independent studios, leaving many in a state of uncertainty. Rizo suggested these deals are "on pause" as Xbox reevaluates its Game Pass strategy.
In a move directly impacting consumers, Activision and Xbox have reportedly confirmed that the upcoming Call of Duty: Modern Warfare 4 will not be available on Xbox Game Pass this year. This follows earlier price adjustments to Game Pass that saw certain new entries removed from the service.
Amidst these uncertainties, reports suggest that Sharma is prioritizing the release of new installments for major Xbox franchises, including Bethesda's Fallout and The Elder Scrolls. The Elder Scrolls VI was announced in 2018 with no further footage revealed, and a new Fallout title has yet to be officially detailed despite the success of the recent Fallout television series.