Feb 03, 2026
3 min read
Microsoft's strategy between multiplatform, regulatory integration and AI focus is contradictory.
Microsoft's latest quarterly numbers show a familiar picture: Xbox devices are back in the double digits, this time down 32 percent compared to the same period last year, accompanied by a 9 percent drop in overall Xbox sales.
Development is no longer a blink of an eye, but a trend that continues for years.
The reasons are obvious.Microsoft has systematically devalued the purchase of an Xbox console.First, the streaming ecosystem expanded to include smart TVs, tablets and other devices, and then came the next step: first-party games are increasingly appearing on PlayStation and Switch, sometimes even on the same day as Xbox.
Anyone who plays on Sony's platform however is missing out on one of the last reasons to have an Xbox in the first place.
At the same time, Microsoft raised prices - more drastically than the competition.While Sony has also made adjustments, the Xbox Series X's $800 price tag seems like an own goal compared to the cheaper PS5 Pro.
No one is surprised that in such conditions there is a decline in sales of equipment.
However, Xbox boss Sarah Bond emphasized that the device is still "absolutely central" to the brand.The next Xbox device should provide a "powerful experience" when bringing your game library to mobile.a statement that many are interpreting as a reference to the "Switch-like hybrid" idea.
At the same time, Microsoft is strengthening its cross-platform strategy, further weakening the hardware position.
The dilemma is obvious: the majority of Game Pass subscribers use Xbox consoles.If Microsoft were to give up the hardware, millions of users would lose their reason to keep the service – because Xbox games would then be available on PlayStation anyway.
The brand is in a situation where it has to build consoles even though demand has been steadily declining since the Xbox One era.
Added to this is Microsoft's big shift to AI.While the company is throwing billions at Copilot and other AI solutions, Xbox plays a small part in that vision.The gaming sector seems like an outlier in a company that is positioning itself as an AI giant.
Attempting to aggressive integrate AI in Xbox hardware can further aliens a weak fan base.
History has shown that big brands can disappear - SEGA and Atari being notable examples.Tech companies like Google, Meta, and Amazon also tried the game and failed.
In light of this, the current state of Xbox looks more precarious than ever.
I'm also currently debating whether I should switch to PC entirely.I've been able to upgrade my somewhat outdated PC relatively cheaply in the last few days and I'm still debating whether I should buy my games directly through Steam and GOG in the future like I did a few years ago.
The series
Me too: Especially since the next Xbox will actually be a PC.I am trying to create a Play Anywhere collection.Unfortunately, my Win11 upgrade is putting a damper on my plans…
Very nicely written post that I totally agree with.
As an Xbox gamer who loves playing Xbox and has also built up a decent software library since the X360, I'm increasingly worried about the way Microsoft is going.Right now, there's no reason you'd need an Xbox other than backwards compatibility and Game Pass for some.The X360 was very good for me in racing.
In the end, Microsoft's only option was to develop a PC-based console or a console with a Steam connection.However, the market will be narrow this year due to Steam Box.It may not be as powerful, but who knows when the next Xbox will come.
There are many questions.And as an Xbox console player, sometimes you want to know what your console bonus really is.I understand the whole Microsoft way financially, but when Phil Spencer talks about the additional cost of the console, I don't see that now.
I see it coming.By Christmas 2026, demand for the Xbox Series X/S will eventually drop to the point where Microsoft will pull the plug and not bring a successor console to market.
Some executives would then say that gamers rejected the Xbox and had no other choice, otherwise they would have had to raise prices even more to break even.
This is exactly what the management was trying to achieve!(But no one will admit it honestly)."We still had revolutionary plans for the next Xbox, but ... blah blah"
In fact, the console was abused by Microsoft itself with actions like these:
Games are released on competing consoles
Console price increase
Improved support on competing platforms (ORI runs at 60 fps on Switch, Xbox games on CD on PlayStation, digital only on Xbox).
Gamepass subscription prices have increased
Microsoft really went out of their way to make me consider buying another console.
Xbox is going to end soon anyway, if you are completely honest and stretch your gray brain cells, the multi-platform strategy is definitely good and brings a lot of money, but if you want something special, for example, the Xbox division, because maybe for half a year or even a year it is worth keeping some Microsoft or Xbox Studio games in an exclusive state, not to mention that the rest will only come out on another console one day!
And what makes things even more complicated is that Microsoft never advertises in Germany on TV or any streaming platform, Microsoft simply doesn't know how to advertise and can never market itself, most people don't even know that the Xbox brand still exists.
Yes, MS damaged the hardware.
One thing is certain: if Xbox exits the market, no one will enter the market again. MS invested an incredible amount of money at that time to step into the console industry.That's why no one else has joined until today.
S@#ۧ situation.As an Xbox fan, this really pissed me off.But I already canceled GamePass and bought a 2MP PC game to save on the online fee.
The game is changing.The world is no longer what it was 20, 50, 100 years ago.Less than 100 years ago, we had no gaming consoles at all.We probably won’t be doing this in 100 years.
It's not a question that Microsoft can still afford the Xbox, it's a question whether it wants to!And it looks like it is.If things go different, we can talk about it.
Valve started it, Microsoft is taking it to the next level and others will follow as always.Sooner or later.
