Microsoft Xbox Game Pass falls to 30 million users, far below 77 million target, prompting Xbox layoffs

Xbox Game Pass, Microsoft’s flagship gaming subscription, is reported to have about 30 million active subscribers. That figure is well short of the internal goal of roughly 77 million users by the end of fiscal 2026, a target disclosed during the FTC review of the Activision Blizzard acquisition. The service previously reported 34 million subscribers in early 2024, but a 50 % price increase in October 2025 and subsequent fluctuations have stalled growth, with the company losing several million members.

In an internal memo, Xbox chief Asha Sharma acknowledged that the subscription’s performance “did not grow at the pace we expected,” and linked the shortfall to weakening core profitability. The shortfall has triggered the largest restructuring in Xbox history: Microsoft will cut 4,800 jobs overall, with 3,200 of those layoffs coming from the Xbox division. Several studios are being reshaped—Compulsion Games and Double Fine have been spun off as independent studios, while Ninja Theory and Undead Labs will move under new ownership. Reports also suggest Arkane Studios may be sold.

The setback comes after years of multi‑billion‑dollar investments, including the $69 billion purchase of Activision Blizzard and the acquisition of multiple first‑party studios. Even high‑profile titles such as Call of Duty, placed on Game Pass at launch, did not generate the subscriber boost Microsoft hoped for, with most sales still occurring on competing platforms. The company plans to continue investing in Game Pass and upcoming projects, but the subscriber shortfall has forced a strategic reset for Xbox.