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According to recent reports, it looks like Microsoft is getting ready to close even more studios in 2026, with bleak times ahead for many developers due to extreme cost-cutting measures.
By now, we all know that the video game industry is ruthless when it comes to making money. Heck, even when the likes of Microsoft and Sony announce record profits, sadly, it’s often followed by a round of employee layoffs and, in some cases, entire studios being closed down.
There could be several reasons; the most logical reason is that a studio isn't turning a profit and essentially becomes a financial sinkhole. The other, which is the most cynical, often follows the aforementioned announcement of record profits.
Not exclusive to the likes of Sony and Microsoft, mega corporations seem to care only about making record profits year after year. While that may be a sustainable concept for a year or two, it’s practically impossible for the long haul.
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When a company announces record profits, especially huge profits, employees may lose their jobs, which gives the impression that even more money will be made the following year. This deceiving profit increase is largely due to not needing to pay as many employees as wages, more than the profits made from a new video game release.
READ MORE: Xbox Teases Extreme 2027 Console Costs Just Days After Latest Price-Hike
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While the closure of these studios is yet to be officially confirmed by Microsoft, sadly, in these kinds of cases, there is often no smoke without fire. Especially when a reputable video game journalist, Jason Schreier, is reporting that a new wave of mass redundancies is on the way.
Of course, in the unfortunate event that any of the studios above are closed down, we’ll be sure to let you know.
