profound

In the last Xbox Games ShowcaseNinja Theory announced ‘Senua’, the third installment of ‘Hellblade’. Eight days later, according to Bloombergthe company is negotiating its closure. They are not the only ones: at least three studios under the Xbox Game Studios umbrella would be negotiating with Microsoft to avoid closure. It is just the tip of the iceberg of an environment with traces of apocalypse at Xbox: the same Monday that the news came out, the head of Xbox Game Studios, Craig Duncan, and the chief of staff, Louise O’Connor, left the company. They are hacks in the structure of the company whose origins and consequences go back a long way. Who closes? The three studios that have been leaked so far are Compulsion Games, which released ‘South of Midnight’ in April 2025, winning a Peabody; Double Fine, founded by LucasArts veteran Tim Schafer in 2000, has recently focused on small games like ‘Keeper’ and ‘Kiln’ in the last year, following a career that includes ‘Psychonauts’, ‘Brütal Legend’ and ‘Broken Age’. Ninja Theory is the studio behind the entire ‘Hellblade’ saga, and before that, high-quality blockbusters like ‘Heavenly Sword’. As other media have also confirmed, like VGCCompulsion and Double Fine are in negotiations to buy themselves and become independent (just as Toys for Bob did in 2023, after which they announced the return of Spyro). Ninja Theory has a more complicated scenario: The studio is being closed directly by Xbox, and its only alternative would be to find an external buyer to acquire it. And in any case, independence is not an easy way out: even if the studios manage to buy themselves, they will lose many employees in the process. Who are these people. Regarding departures from the management team, Craig Duncan arrived at Xbox in 2011 and directed Rare for more than 13 years, a period in which ‘Sea of ​​Thieves’ was released and the Kinect peripheral was developed. He assumed leadership of Xbox Game Studios in October 2024, when under that umbrella there were studios such as Halo Studios, The Coalition, Playground Games, Obsidian, Ninja Theory, Compulsion Games, Double Fine and a dozen more. His duties will be temporarily assumed by Matt Booty. Louise O’Connor also came to Xbox through Rare, where she joined in 1999 as an animator. This is her second discharge: she obtained the position of chief of staff in September 2025, shortly after leaving Rare following the cancellation of ‘Everwild’. These two simultaneous departures, in the positions that mediate between the CEO and the studios, point to internal turbulence. “This cannot continue.” Less than a week ago, new Xbox CEO Asha Sharma and Matt Booty published a internal memo that was also made public in which they described the situation in the company with considerable crudeness. The fiscal year that ends June 30 will leave Xbox with a profit margin of around 3%. The division spent $20 billion on studio investments over the past five years (not counting, of course, the purchase of Activision Blizzard for 69,000 million) while its annual income fell almost 500 million in the same period. Not everything is bad management, but a situation, in general, very complicated for the sector: the company currently pays four times more for hardware components than last fall (as they all do), and that cost is expected to rise even more heading into Christmas 2027. The memo called the studio system “overextended” and admitted that Xbox had tried to “balance too many different strategies” without funding its studios enough to be competitive. “This cannot continue,” they even said. What is coming. It is expected that Xbox will announce things after the close of the fiscal year, on June 30 (the same day of the memo, in a coincidence that is difficult to see as coincidental, Bloomberg advanced that the company is going to suffer massive layoffs). Sharma said that the new Xbox will prioritize “the biggest franchises”, that is, ‘Halo’, ‘Gears of War’, ‘Fable’ or ‘The Elder Scrolls’. It is possible to think that studies with lower IPs or that minimally deviate from the mainstream They are left out of the plans. What undoubtedly increases the feeling of unleashed chaos and profound earthquakes within the company is the timing: This all takes place right after the Summer Game Fest, when Xbox presented a showcase on June 7 with very precise and careful plans, which included Ninja Theory’s own ‘Senua’, the return of ‘Fable’, the long-awaited new ‘Gears of War’… A week later, one of the studios that starred in that showcase He is negotiating his survival. In Xataka | Xbox lowers Game Pass and backs down with Call of Duty: the bet of “Everything on subscriptions” has not turned out as Microsoft expected