Xbox says it's not reducing its 'overall investment in games' as rumors of studio closures continue

If you've been following the recent news surrounding the goings on at Xbox, you're probably aware that the situation for the developer, publisher, and hardware maker is pretty grim. In the past week, we've heard several rumors from multiple credible sources that Xbox is set to close or part ways with several of its first-party studios.

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In the past day alone, we've heard that acclaimed developer Arcane, who's working on Marvel's Blade, is on the list, alongside Xbox cutting ties with IO Interactive by pulling funding on the fantasy RPG the studio was working on for Xbox Game Studios. IO Interactive has confirmed that last one, and according to Bloomberg reporter Jason Schreier, the studio is now looking elsewhere for funding.

And when you add in studios like Compulsion Games, Ninja Theory, Double Fine, and Undead Labs into the mix of impending Xbox studio closures, you definitely get the impression that Xbox is looking to save money or turn around its recent financial downturn, where the Xbox division is reportedly only delivering a profit margin of 3%. However, in that same Bloomberg article, a Microsoft representative claims that the company isn't reducing its "overall investment in games."

"(We're) taking a fresh look at where we invest so we're focusing on our highest priorities," the statement reads. "We're not reducing our overall investment in games. We expect to invest about the same in content as we did last year. What's changing is where we're investing and the kinds of projects we're backing."

What does this mean? Time will tell, but there's word that Microsoft and the Xbox team, under freshly minted CEO Asha Sharma, are kicking off a major reset for the brand, shifting its development focus toward core games and franchises. This includes Halo, Forza, Call of Duty, The Elder Scrolls, and Fallout. According to rumors, Xbox is looking to expedite the development of both The Elder Scrolls 6 and the next Fallout game to get them out sooner rather than later.

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Unfortunately, even if Microsoft isn't reducing its investment in games, this realignment means that instead of pouring more money into developing key franchises like The Elder Scrolls 6, it's going to cut smaller developers and studios that aren't working on titles like The Elder Scrolls 6.