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Evening Reading - July 29, 2026
This edition of Evening Reading covers several gaming industry updates, including a sequel in development for Wuchang: Fallen Feathers and a DLC release for Pokemon Pokopia. Financial reports from Capcom, SK Hynix, Electronic Arts, Facebook, and Microsoft are highlighted, with EA CEO Andrew Wilson's compensation increasing due to Battlefield 6's success. Additionally, Facebook's Reality Labs reported significant losses, while Silent Hill: Townfall is noted for its innovative use of outdated technology. The article also touches on streaming events and new content for Marvel's Spider-Man 2.
Business and Finance
Microsoft's Xbox division experienced a 10 percent revenue drop, contrasting with significant growth in its cloud and AI businesses. Separately, a Capcom producer indicated that the Resident Evil remakes are a key financial driver for the company.
Evening Consolidation
Microsoft CEO stated that the Xbox division is expected to return to growth in the upcoming fiscal year. Separately, Xbox acknowledged that game disc functionality failed during a recent service outage.
Games Inbox: Are user reviews for video games reliable?
Readers discuss the reliability of user reviews for video games, with many expressing skepticism due to fanboyism and review bombing, favoring curated professional reviews or Steam's larger user base. The letters also touch on game release schedules, the evolution of game development timelines, the importance of modern-day storytelling in the Assassin's Creed series, and the business practices of companies like EA.
Xbox Revenue Fell by 10 Percent in Last Quarter
Microsoft's Xbox division experienced a 10 percent revenue decrease last quarter, coinciding with significant layoffs across the division. While overall Microsoft revenue increased by 18 percent due to cloud services like Azure, the Xbox content and services segment, along with the Windows OEM and Devices division, saw declines. As part of restructuring, Xbox divested four studios: Compulsion Games, Double Fine Productions, Undead Labs, and Ninja Theory.
“Necessary Decisions” Are Being Made to Reset Xbox for Long-Term Growth, Says Microsoft CEO
Microsoft CEO Satya Nadella stated that "necessary decisions" are being made to reset Xbox for long-term growth, citing a 10 percent revenue decline in the last quarter. The company plans to diversify its business across subscriptions, ads, and digital stores, and expand to new ecosystems. This strategy follows recent layoffs and the divestment of four studios: Compulsion Games, Double Fine Productions, Ninja Theory, and Undead Labs.
EA Handed Its CEO $38.6 Million In The Same Year It Cut Battlefield 6 Staff
Electronic Arts CEO Andrew Wilson received $38.6 million in compensation during the same fiscal year the company conducted layoffs across its Battlefield development teams. Despite the cuts, EA reported a record net revenue of $7.531 billion, driven by the successful launch of the Battlefield franchise, which reportedly outsold a Call of Duty title released in the same year.
Xbox just had its worst quarter in years
Microsoft reported a significant 10% decline in Xbox content and services revenue for its fourth fiscal quarter, marking the worst quarter for Xbox revenue since Q1 2024. Hardware revenue also saw a 13% drop, contributing to a total Xbox revenue of $4.983 billion. The report also mentions severance expenses due to layoffs, partially offset by other cost-saving measures, while the company's overall revenue was boosted by AI investments.
Halo: Campaign Evolved On PC Has A Hidden Feature You Need A Mod To Access
A new mod for Halo: Campaign Evolved on PC restores the missing split-screen co-op feature, which is available on PlayStation 5 and Xbox. The mod, however, is limited to two players and controller input, and may not work for PC Game Pass or Microsoft Store versions. The game's ending also hints at a potential Halo 2 remake.
Xbox content & services revenue decreased 10% YoY in Microsoft (MSFT) Q2 2026
Microsoft reported a 10% year-over-year decrease in Xbox content and services revenue for Q2 2026. This decline was partially attributed to severance expenses and impairment charges related to recent layoffs and reorganization within the Xbox division under CEO Asha Sharma. Despite the drop in Xbox revenue, Microsoft's overall financial results for the quarter exceeded expectations.
Microsoft (MSFT) spent $4.579 billion on share buybacks during Q4 2026
Microsoft spent $4.579 billion on share buybacks in the fourth quarter of its 2026 fiscal year, bringing the total for the year to $22.271 billion. This spending comes as the company also conducted layoffs. The company's Q4 earnings surpassed analyst expectations.
Facebook (META) Reality Labs lost $4.62 billion in Q2 2026
Meta's Reality Labs division reported a loss of $4.62 billion in Q2 2026, an increase from the previous quarter's $4.028 billion loss. Despite significant financial losses, Meta continues its investment in virtual and augmented reality technologies, including its Meta Glasses and VR headsets. The company's overall revenue for the quarter reached $60.80 billion.
Microsoft (MSFT) Q4 FY26 earnings results beat revenue and EPS expectations
Microsoft exceeded revenue and earnings per share expectations for its fourth fiscal quarter of 2026, reporting $90.0 billion USD in revenue and $4.81 per share. The company highlighted significant growth in its cloud division, with Azure revenue surpassing $100 billion and Microsoft 365 Copilot reaching over 30 million paid seats, driven by AI investments. Despite these successes, the personal computing division, including Windows and Xbox content and services, saw a decline.
Facebook (META) Q2 2026 earnings results beat revenue but miss EPS expectations
Meta Platforms reported its Q2 2026 earnings, exceeding revenue expectations with $60.80 billion but falling short of the $7.10 per share EPS target, leading to a stock price drop. CEO Mark Zuckerberg highlighted AI's accelerating impact on the business and future products, while the Reality Labs division reported a $4.62 billion loss for the quarter.
Inside Microsoft’s scramble as an AI model buries its engineers in bugs
Microsoft is struggling to keep pace with the sheer volume of critical and important software bugs discovered by Anthropic's AI model, Mythos. The AI has uncovered hundreds of flaws in products like SharePoint, Microsoft 365, and Teams, overwhelming engineering teams tasked with fixing them before potential exploitation by adversaries. This situation highlights the challenges of integrating AI into software development and the growing need for robust cybersecurity measures.
Elder Scrolls Online’s newly launched quest involves Uncle Sheogorath and cheese, of course
The Elder Scrolls Online has released a new story questline titled 'Sheogorath Takes a Holiday,' available for all players. This update features the Daedric Prince Sheogorath and his obsession with cheese as players embark on six new quests across Tamriel. The quest is free for all players and introduces a new Blessed Cheese emote, alongside a Golden Pursuits campaign running until August 12th.
Perfect Ten: MMORPGs whose fans I feel sorry for
This opinion piece discusses ten MMORPGs whose fans are felt to be underserved or unfairly treated due to various issues like poor publishing deals, legal troubles, corporate decisions, or a perceived lack of developer care. Games like Fractured Online, Ashes of Creation, The Elder Scrolls Online, and New World are highlighted for their fanbases facing significant challenges.
Morning Consolidation
Microsoft's Xbox Series X and Series S consoles are reportedly losing $150 per unit sold. This financial information raises questions about the company's hardware sales strategy and profitability in the current market.
An Xbox outage left physical games unplayable, tech lead says Microsoft is working to make sure that never happens again
Microsoft's Chief Technology Officer Scott Van Vliet stated that an Xbox outage which rendered some physical games unplayable should not have occurred. The company is investigating the issue, which involved disc-based entitlement checks preventing access, and plans to implement a fix in a future update to ensure this does not happen again.
Double Fine Cuts 25% Of Staff After Separating From Microsoft
Double Fine has laid off 25% of its staff, approximately 23 employees, following its separation from Microsoft and regaining independence. Studio head Tim Schafer stated the cuts were necessary to scale the studio to a sustainable size. Microsoft had divested five studios, including Double Fine, earlier this month.
