Microsoft has laid off 4,800 employees, with 1,600 from the Xbox division. Double Fine and Compulsion Games are becoming independent studios again. Ninja Theory and Undead Labs are reportedly being sold. Xbox CEO Asha Sharma called it a 'reset' and said 20% of the division's workforce will be cut by July 2027.
At BitSummit PUNCH, held May 22-24, 2026 at Miyako Messe in Kyoto, Double Fine Productions gave a rare interview in Japan. Project lead Derek Brand discussed the studio's upcoming multiplayer title 'Kiln', which departs from their usual story-driven single-player games. Brand explained that 'Kiln' began from the concept of letting players create their own characters and fight with them, with pottery and ceramics chosen as the medium after the team found a photo of pots and drew faces on them. The team took pottery lessons for several months during pre-production. Creative lead Lee Petty spoke about 'Keeper', a wordless single-player adventure released last year about a lighthouse that grows legs and walks. Petty said the idea came from a walk during the pandemic, thinking about what becomes meaningless after humanity disappears. Both developers noted that since joining Xbox in 2019, the studio has gained resources without restrictions on their creative freedom. They expressed gratitude to Japanese fans and said development on 'Kiln' continues.