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The long-rumored Xbox bloodbath has commenced with the company’s recent announcement that it is laying off thousands of employees and selling off studios. It is a disastrous event for the many workers who have been under Xbox’s shaky leadership, which, in its acquisition spree, has prioritized Xbox Game Pass. However, a new report has now noted how that initiative has come in way under expectations.
According to a Wall Street Journal report, a legal document relevant to the Activision acquisition stated Xbox projected it would have around 77 million Game Pass subscribers by 2026. This is quite a projection, especially as Xbox console sales have not been substantial enough for the company to speak publicly about in recent history. PlayStation, for example, has officially said it has sold 93 million PS5 consoles, but Xbox has not been as forthcoming, likely because it is selling well below that.
The reality for Xbox Game Pass subscribers, according to Wall Street Journal’s source, is much more grim, as this person has noted there are only currently around 30 million subscribers. This is only around 39% of Xbox’s projections.
Xbox Game Pass Subscribers Have Been Jumping Ship, Too
Xbox Game Pass subscribers appeared to have peaked around 35 million subscribers as of summer 2025. However, this was before the last price hike that saw a significant jump in cost; Ultimate, for example, went from $19.99 a month to a staggering $29.99 per month. Xbox’s current leadership walked some of that cost back down and settled on $22.99 per month by saying new Call of Duty games wouldn’t launch on Game Pass. This is consistent with Xbox’s chief strategy officer Matthew Ball’s recent words saying the console maker lost millions of subscribers after that October 2025 price hike. The cancelation website even began a buckle a bit, further backing up Ball’s claims. Xbox CEO Asha Sharma also spoke to this stagnation in her recent memo speaking to the mass layoffs.
“To grow, we bet on Game Pass, multi-platform, and a broader portfolio of content,” she said. “While those businesses have created meaningful value, they did not grow at the pace we expected.”
This is perhaps some of the most damning information to come out around Xbox’s recent strategy. Needing to fill out Game Pass’ library was a big driving factor in why it gobbled up many studios like Double Fine, Ninja Theory, and Compulsion Games, to name a few, over the last few years. A subscription service needs consistent content to thrive, after all. It was a big bet to spend literal billions of dollars on studios in order to potentially realize this initiative, with the $69 billion Activision Blizzard acquisition being the biggest push in this regard. Sharma herself seemed bullish on that specific acquisition, as she gave a corporate word salad answer that lacked a positive affirmation when asked about it.
A company growing too quickly and going hard on unprecedented growth before then tearing down thousands of employees when those plans don’t come to fruition is yet another example of unrealistic expectations coming down on those who were just following the directives they were given, something Bloomberg reporter Jason Schreier has also reported on.
It seems as though Xbox is still aiming for idealistic numbers, as Sharma said in her aforementioned memo that she wanted Xbox to be “one of the few companies that entertains more than a billion people each day and gives everyone the opportunity to create and connect.” That comes out to around one in eight people on the planet. Given those lofty ambitions, Xbox’s place in the industry, the tight global economy, it remains to be seen whose heads will roll if those expectations aren’t met. If history is an indicator, it probably won’t be Sharma’s.
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