Today, massive layoffs hit Xbox. Who’s affected? What games are being cancelled? And what does this mean for the future of Xbox? I’m Alec, and this is your daily fix. Let’s break it all down. It turns out the rumors were true. Massive layoffs just hit Microsoft. The Xbox parent company is laying off over 9,000 employees, affecting roughly 4% of its 228,000 employees worldwide, and several game studios and highly anticipated projects are caught in the crossfire, which we’ll get into in a bit. This is the fourth mass layoff at Xbox in the last 18 months. Earlier layoffs included the closing of studios like Arcane Austin and Tango GameWorks. Xbox CEO Phil Spencer released a lengthy internal memo announcing the layoff, saying, quote, “Today, we are sharing decisions that will impact colleagues across our organization to position gaming for enduring success and allow us to focus on strategic growth areas. I recognize that these changes come at a time when we have more players, games, and gaming hours than ever before. Our platform, hardware, and game roadmap have never looked stronger.” While boasting about company profits and a hopeful future isn’t the most tasteful thing to do when terminating thousands of jobs, the business side of Xbox’s overall gaming revenue was up 5% year-over-year for the quarter, with a big part of that growth coming from Game Pass subscriptions, Minecraft, and Call of Duty. All this despite declining Xbox hardware sales this generation and last. However, even though Call of Duty was a huge driver of revenue, it still wasn’t immune to this round of layoffs as multiple Call of Duty development studios had layoffs hit members of their staff today. In general, tons of studios under the Xbox umbrella were impacted with today’s cuts with some studios closed completely and some highly anticipated games canled for good. Let’s start with the biggest and most shocking game cancellation today, Perfect Dark. Along in development reboot of the classic N64 and Xbox 360 first-person shooter franchise, the initiative the studio formed in 2018 had some massive talent attached to it, including Daryl Gallagher, one of the leads behind 2013’s Tomb Raider reboot. While development around Perfect Dark had reportedly been troubled with Tomb Raider, the Avengers, and Legacy of Kane studio Crystal Dynamics being pulled in as a support studio in recent years, the game had a promising showing at the Xbox Game Showcase last year. Perfect Dark was noticeably absent in last month’s Xbox Game Showcase, and now we know why. As of today, Perfect Dark is officially cancelled, and The Initiative’s entire studio is being closed. What was once an iconic firstperson shooter video game franchise now has a completely unclear future. I’d be surprised if we get any new Perfect Dark game anytime soon, if not ever again. And hey, that absolutely sucks. Meanwhile, you’d think things might be a little safer for the new games coming from proven Xbox game studios that had already shipped massively successful hit games, but it looks like that’s not the case either. Ever Wild, Rare’s long awaited follow-up to Sea of Thieves has also been cancelled today. Rare has been working on developing this original IP for over a decade. All the while, Seth has done some serious business for Microsoft, recently becoming one of the bestselling games on PS5 after being ported to that platform, reportedly selling over 1 million copies out of the gate. Prior to coming to PS5, Sea of Thieves had already reached 40 million players across Xbox and PC, which is something they felt they needed to brag about. However, it seems none of that was enough to give Rare’s next game the benefit of the doubt, as a long in development third-person fantasy adventure game, Everworld, is now no longer happening. What this means for Rare, or what their next project will be remains to be seen. Unfortunately, that’s not Xbox’s only MMO on the chopping block. The new MMO RPG code name Blackbird from The Elder Scrolls Online developers at Zenax Online Studios, which has been in development since 2018, has also been cancelled. Even big Xbox franchises like Forsa, aren’t immune. Turn 10 Studios, the developers behind the Forsa Motorsports simulation games, not to be confused with the open world Forsa Horizon games, have also laid off nearly 70 staff members, meaning the next Forsa installment of the Forsa Motorsports series will have to be made by a drastically smaller team. Today’s cuts even hit king as the developers of the immensely popular mobile games Candy Crush are also being affected. According to Bloomberg, the studio is laying off 200 employees, which is about 10% of its workforce. While games like these never getting to see the light of day really hurts, Xbox is probably betting that it’s better to cut their losses before spending even more money getting them to the finish line. What’s really surprising, though, is that Xbox is cutting jobs around its very profitable golden goose, Call of Duty. Studios who work on the franchise like Raven Software, Sledgehammer Games, Infinity Ward, and Highmoon Studios have all had employees announce cuts. Call of Duty is regularly one of the bestselling, if not the bestselling video game of the year. But with AAA games development budgets bloating to unseen levels year-over-year, it seems even the most successful game franchises can’t survive these days with their staff intact. So, to recap, Xbox keeps closing studios, cancelling highly anticipated games, and cutting game developer jobs. They stopped revealing Xbox hardware sales numbers years ago and just recently raised the prices of all of their Xbox Series consoles. At the same time, they’re reporting increased Game Pass subscription numbers and huge wins when porting their current software library to competitor platforms like PS5, with the Switch 2 likely to follow. They just announced a new handheld gaming system partnership with Rag Ally and recently confirmed their commitment to developing consoles for the next generation of video game hardware. So, what does this all mean for the future of Xbox? Honestly, waking up to this news sucks. As a fan of Xbox, I’m struggling to have faith in the brand. A lot of these games like Perfect Dark, I was really excited for. I’d love to know what went wrong. Why aren’t we getting the games they teased? Part of me wonders if Xbox is mismanaging its studios. Their lack of hardware sales and reliance on PS5 game sales isn’t inspiring confidence. But I’m also aware that gaming is getting even more expensive. And not just for gamers. It’s wild how fast development costs are spiking. Look at Call of Duty. Just earlier this year, it was revealed that Call of Duty budgets keep slowly creeping closer and closer to 1 billion per game, despite each game selling less and less copies. Black Ops 3 cost 450 million to develop and sold 43 million copies in 2015. By 2020, Black Ops Cold War cost $700 million and only sold 30 million copies. Then again, microtransactions are a much bigger thing now than they’ve ever been before. And maybe this is just the cost of doing business now. It’s estimated that GTA 6’s budget is over $1 billion. And let’s be real, most gamers spend a large part of their play time on only a handful of games like Fortnite, Call of Duty, GTA, and Roblox. It’s getting tougher and tougher to get people to pay attention to new franchises and even reboots of classic ones. But here’s the thing, you don’t need $1 billion to create a successful game anymore. A 16-year-old has developed Grow a Garden, a Farmville like Roblox game that topped out at 21.3 million concurrent players in June. Steamrolling Fortnite’s all-time peak of 14.3 million players. That’s right, one of the most popular games in the world right now was developed by a teenager in Roblox. The point I’m trying to make here is that the games industry is in a real state of flux right now, and Xbox’s future seems unclear. As a huge fan of Xbox franchises like Halo, Gears of War, and also smaller games like Fusion Frenzy, which is the exact type of upbeat title that Xbox might be hesitant to develop in the future. I’m nervous about Xbox’s ability to deliver actually playable games, never mind playable games on Game Pass day one. And Xbox’s flashy franchise, Halo, has been completely fumbled between the roll out of the last game and the TV show we’ve all really tried to forget. They basically fumbled Xbox’s Mario. Halo Studios recently confirmed that they’ll have something to show at the Halo World Championship this October. I’m sure there’s a lot of pressure writing on that team to really bring Master Chief back for Xbox, but would that be enough to win people back? Xbox says they’re doing all these layoffs to prioritize the strongest opportunities and deliver exceptional games and experiences for players and generations to come. I don’t know, maybe they have a super secret master plan that they haven’t unveiled yet. Xbox’s 25th anniversary is coming up next year. Maybe then all these tough decisions will make sense. Right now, it just seems like constant bad news for game developers and gamers in general. So, what do you think Xbox has to do to bring faith back to the brand? Do you think they can return to their glory days, or are hard days like today necessary so they can evolve? Let us know in the comments below. And that’s it for today’s fix. I am Ali. Thanks for watching and I’ll see you guys on the next one.