According to journalist Jez Corden on X, Amy Hood, Microsoft‘s CFO, reportedly set unrealistic financial targets for Xbox, which caused significant harm to the division and will continue to have negative effects in the future. These targets might also be behind the recent cuts, including the cancellation of several projects like Perfect Dark and Everwild, and the closure of studios such as The Initiative. Corden believes that these actions will not be the end, and that the demands from the parent company will cause more damage to Xbox in the future.
Unrealistic Financial Goals
“Microsoft CFO Amy Hood has given Xbox an utterly unrealistic financial requirement that is going to continue hurting the division. This isn’t over,” Corden wrote.
Another technology journalist, Tom Warren, confirmed the existence of these targets. He responded to Corden, saying, “I don’t think it’s unrealistic, it’s just the reality of the Xbox business after the ABK acquisition. Without that deal Xbox revenue would be down, and the Game Pass gamble hasn’t paid off yet.”
Impact of Microsoft’s Strategic Decisions
This situation highlights the pressure Phil Spencer faced in making cuts, which were driven by Microsoft’s focus on investments in generative AI. These cuts, which included shutting down studios and projects, were also linked to the financial targets set by the company’s leadership, which increased after the acquisition of Activision Blizzard King.
