Xbox owns a lot of studios across the globe; here's which ones are still active and which are not as of July 2026

Compulsion and Double Fine studios will become independent; Undead Labs and Ninja Theory will be sold. Xbox will also look to sell or spin out Arkane Studios.

Xbox CEO Asha Sharma calls it the most significant restructuring in Xbox history: 3,200 job cuts, four studio spinoffs, a new COO, and a flattened management structure — all aimed at turning around a division she says has been losing 64 cents on every dollar invested in its studios.

Xbox CEO Asha Sharma said Microsoft’s video game business is in desperate need of a “reset,” which apparently means job cuts and the shedding of several game studios. Sharma announced in a memo to staff,

The layoffs were part of wider cuts at Microsoft, as the company prioritizes spending on artificial intelligence.

Xbox CEO Asha Sharma confirms 4 studios are leaving Microsoft, with a fifth, Arkane Studios, fate uncertain amid mass layoffs.

Xbox will cut 3,200 roles, while Ninja Theory, Undead Labs, Compulsion Games, and Double Fine Productions are leaving the Xbox Games Studio banner.

Last month, Xbox executives laid out some “hard truths” about Microsoft’s struggling gaming division that they said would require a difficult “Xbox reset.” This morning, Microsoft revealed the brutal shape of that “reset,