Hit Points
Independent games industry analysis and commentary by Nathan Brown (ex-Edge).
Documents
The Curious Case of the Missing Switch 2 Devkits
The gaming industry is currently facing a significant bottleneck regarding the Nintendo Switch 2, characterized by a widespread scarcity of development kits.
- Nintendo is reportedly restricting access to Switch 2 development kits, leaving many developers—including major studios—unable to optimize their titles for the new hardware.
- Nintendo is directing developers to rely on backwards compatibility for the Switch 2, which prevents studios from leveraging the console's enhanced technical capabilities.
- The lack of dev kits forces developers to adopt a 'ship and hope' strategy, as they cannot test how their games perform on the Switch 2's higher-resolution display or improved hardware.
The Idiots Are Winning
The game industry is currently facing a significant shift in content moderation driven by external pressure from financial institutions.
- Itch.io has hidden all adult NSFW content from search and browse results following pressure from payment processors, leading to the mass delisting of both adult and non-adult indie games.
- Steam has updated its developer terms to prohibit content that violates the standards of its payment processors, resulting in the removal of dozens of titles from its storefront.
- The pressure group Collective Shout successfully lobbied payment processors like Visa, Mastercard, and Stripe to target platforms hosting games they deem offensive, effectively positioning financial institutions as moral arbiters of digital content.
Going Dark
The July 2025 layoffs at Microsoft represent a significant escalation in the company’s restructuring of its gaming division.
- Microsoft has initiated its fourth wave of Xbox layoffs in 18 months, cutting 9,000 staff worldwide despite the company reporting $70.1 billion in revenue and $25.8 billion in profit for the last quarter.
- Major project cancellations include the reboot of Perfect Dark at The Initiative, the Rare-developed title Everwild, and a sci-fi looter-shooter codenamed Blackbird at Zenimax Online Studios.
- The layoffs have impacted a wide range of internal studios, including significant staff reductions at Turn 10 (Forza Motorsport), King (Candy Crush), and teams working on Call of Duty and Halo.
Midnight Caller
The June 2025 industry analysis provides an early assessment of the Nintendo Switch 2 launch, characterizing the hardware as a premium, technically capable, and thoughtfully iterated device that departs from Nintendo’s traditional toy-like aesthetic.
- Tencent has acquired a 15% stake in Arrowhead Games, the developer of Helldivers 2, for $80 million.
- Tencent has also invested in Lighthouse Games, a studio founded by former Forza developer Gavin Raeburn that is currently looking to expand its 130-person staff by approximately 50 employees.
- The Nintendo Switch 2 has launched with a premium hardware focus, featuring improved haptics, Nvidia-powered performance, and a system-transfer process that allows for the migration of user data between consoles.
Bomb Disposal
The gaming industry experienced a significant decline in media diversity and stability in early May 2025, marked by the acquisition of Polygon by Valnet and substantial layoffs at Giant Bomb.
- Vox Media has sold the gaming outlet Polygon to Valnet, a company known for managing a network of websites focused on search-optimized content.
- Giant Bomb is undergoing significant layoffs and a strategic shift toward game guides, moving away from its established focus on personality-driven livestreams and podcasts due to new brand safety guidelines.
- Rockstar Games has delayed the release of Grand Theft Auto VI to May 26, 2026, a move expected to negatively impact traffic and stability across the broader games media industry.
Carve It Up
The provided text serves as a critical review of a comprehensive industry analysis titled The State Of Video Gaming In 2025, a 220-slide presentation authored by venture capitalist Matthew Ball.
- The global game industry is currently characterized by flatlined console growth, a reliance on mobile for growth, and a market where players increasingly consolidate their time into established titles like Fortnite and Counter-Strike.
- Electronic Arts has lowered its fiscal year net bookings forecast to just over $7 billion, down from an original projection of $7.5–7.8 billion, citing a holiday-season revenue slump in EA Sports FC 25.
- Genshin Impact developer Cognosphere has agreed to a $20 million settlement with the FTC regarding deceptive loot box practices and child privacy violations, despite the game being on track to reach $10 billion in global revenue this year.
Lead Balloon
The analysis examines a recent investigative report by Hindenburg Research regarding Roblox Corporation, which alleges systemic deception by the platform.
- Hindenburg Research has released a report alleging that Roblox Corp has been overstating its daily active user metrics by up to 40% by failing to distinguish between human users and bot activity.
- The Hindenburg report accuses Roblox executives of selling shares ahead of the negative disclosures and claims the platform's moderation failures have created an environment that exposes its largely underage audience to severe safety risks.
- Roblox has yet to report a single quarterly profit since going public in 2021, and the company's financial performance shows that its losses have increased even as its revenue and user base have grown.
Memory Lapse
The gaming industry’s current approach to promotional showcases, specifically during the period surrounding the 2024 not-E3 season, is characterized by an unsustainable volume of content that undermines both viewer engagement and developer visibility.
- The 2024 'not-E3' period featured 18 separate showcases that collectively presented over 600 games, creating an overwhelming volume of content that makes effective discovery and coverage nearly impossible.
- Individual events like Guerrilla Collective, Wholesome Direct, and the PC Gaming Show each featured approximately 70 games within tight timeframes, prioritizing rapid-fire announcements over meaningful audience engagement.
- Geoff Keighley’s Summer Game Fest was noted for improved curation and inclusivity compared to previous years, though the broadcast still suffered from a loss of focus during its final half-hour due to commercial obligations.
Dishonoured
The closure of four Bethesda-affiliated game studios by Microsoft in May 2024 serves as a critical case study in the ongoing instability within the video game industry.
- Microsoft has abruptly closed four Bethesda-owned studios: Tango Gameworks, Arkane Austin, Alpha Dog, and Roundhouse Games.
- The closure of these studios signals a strategic shift away from 'gamer games' and toward a model focused on massive, multiplatform franchises like Call of Duty, World of Warcraft, and Candy Crush.
- Xbox revenue has increased by 60% since the completion of the Activision Blizzard acquisition, leading to a pivot away from the original Game Pass strategy of exclusive, high-quality, mid-sized titles.
Spencer's Lament
The current state of the Xbox division reflects a long-term failure of strategic leadership rather than merely the result of broader industry stagnation.
- Phil Spencer attributes Xbox's recent strategic shifts—including layoffs and the release of exclusives on rival platforms—to a stagnant gaming industry that is failing to grow its total player base or revenue.
- Industry observers and publishers are increasingly questioning their support for the Xbox platform due to high development costs, the requirement for parity between Series S and X hardware, and a subscription-first model that may cannibalize game sales.
- Despite spending roughly $100 billion on acquisitions, including Activision Blizzard, Xbox has failed to produce a consistent library of high-quality first-party titles capable of driving hardware sales.
Legacy Thinking
The game industry experienced a period of significant contraction in late February 2024, characterized by widespread layoffs and studio closures across both independent and major corporate entities.
- PlayStation announced 900 job cuts, representing approximately 8% of its global workforce, which includes the total closure of the 22-year-old London Studio and layoffs across Naughty Dog, Insomniac, Firesprite, and Guerrilla Cambridge.
- EA is laying off 670 employees (roughly 5% of its global staff), shuttering its Ridgeline Games studio, and cancelling a planned Star Wars first-person shooter from Respawn Entertainment.
- Supermassive Games has initiated redundancy processes for nearly half of its 300-person staff, aiming to eliminate 90 positions, while Deck Nine is cutting 20% of its workforce due to worsening market conditions.
Cowboy Builder
The current leadership transition at Sony Interactive Entertainment, marked by the appointment of Hiroki Totoki as interim head, signals a shift toward a more aggressive, investor-focused management style that risks alienating development talent.
- Sony interim CEO Hiroki Totoki publicly criticized Bungie for poor management of development timelines and business expenses, signaling a shift toward more aggressive oversight of its studios.
- PlayStation lowered its fiscal year hardware sales forecast from 25 million units to 21 million units, a move that contributed to a $10 billion decline in Sony’s market capitalization.
- PlayStation’s operating margins have halved over the last two years and are currently trending toward their lowest point in a decade.