Sony and Microsoft Undergo Major Restructuring: Sony Axes 10 Games, Double Microsoft’s Cuts

The global gaming industry is experiencing significant turbulence as two major players, Sony and Microsoft, implement large-scale restructuring, including layoffs, studio adjustments, and project cancellations. Notably, Sony has scrapped at least 10 game projects during the current console generation (PlayStation 5 era), twice as many as Microsoft’s (Xbox Series X|S era) five cancellations, highlighting the industry-wide pressure of rising development costs and strategic downsizing.

Sony: Aggressive Cuts, 10 Games Canceled

According to internal sources and industry reports, Sony Interactive Entertainment (SIE) has conducted extensive reviews of its studios, leading to the termination of at least 10 unannounced or in-development games—far exceeding Microsoft’s reductions. This reflects Sony’s stricter approach to game development oversight.

Affected projects include:

• A live-service game from London Studio (originally intended to compete with Destiny 2)
• An unannounced new IP from Guerrilla Games (outside the Horizon series)
• A new project by Bend Studio after its Days Gone sequel pitch was rejected

Several PlayStation VR2 titles shelved due to poor market performance

Sony CEO Kenichiro Yoshida previously stated the company is “optimizing resource allocation to focus on high-quality, high-impact titles.” Analysts attribute this to soaring AAA development costs (e.g., *Marvel’s Spider-Man 2*’s $300M+ budget) and uncertainties in live-service games (e.g., the Twisted Metal reboot).

Microsoft: 5 Projects Dropped, Core IPs Prioritized

Microsoft Gaming has also streamlined operations, with Xbox head Phil Spencer confirming five canceled games and the closure of studios like Arkane Austin (Redfall developer). Compared to Sony, Microsoft’s cuts focus on post-acquisition consolidation, including:

• Scrapping select unannounced Bethesda projects
• Ending experimental titles under Xbox Game Studios
• Adjusting Xbox Cloud Gaming initiatives

Spencer emphasized a shift toward “core franchises like Call of Duty, Starfield, and Forza,” alongside cross-platform expansion (e.g., Sea of Thieves on PS5).

Industry Trend: Rising Risks in AAA Development

The cuts underscore shared industry challenges:

• Ballooning Costs: Next-gen games now average $200M+, straining ROI.
• Live-Service Competition: Sony’s Twisted Metal and Microsoft’s Redfall underperformed.
• Post-Merger Integration: Microsoft faces post-Activision Blizzard digestion, while Sony grapples with studio management efficiency.

Research firm Newzoo projects global gaming growth may slow to 2% in 2024, pushing firms toward “fewer, bigger bets.” Expect further pruning of mid-tier projects in favor of marquee IPs and live-service staples.

Note: Data reflects public reports and analyst estimates. Official details may vary.