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Game On: Microsoft cuts Xbox staff amid AI push

NEW RELEASES: This week’s most significant new release is Kojima Productions’ “Death Stranding 2: On the Beach,” published by Sony (SONY) as a PlayStation 5 exclusive. The action-adventure title, directed by Hideo Kojima of “Metal Gear” fame, launches June 26.

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MICROSOFT GAMING: On Monday, Microsoft’s (MSFT) Xbox said that, starting this week, users enrolled in the PC Gaming Preview can get a first look at the new aggregated gaming library in the Xbox PC app for Windows 11 PCs and handheld devices. The feature will be available this holiday on the ROG Xbox Ally and ROG Xbox Ally X, where players will see their aggregated gaming library within the new Xbox full screen experience. With this new feature, a user’s Xbox library, hundreds of Game Pass titles, and all their installed games from other PC game stores are always at their fingertips.

Meanwhile, Xbox also announced in a blog post hat Copilot for Gaming is available now for early preview on mobile and will be coming to PC soon. “We are introducing the ultimate gaming sidekick that helps players get to play faster, sharpen their skills with expert coaching, and enjoy a more interactive and social gaming experience,” the company said. “Currently available for early preview in the beta version of the Xbox mobile app, available on iOS and Android, and coming this holiday on the ROG Xbox Ally. In this early version, players can ask Copilot about any games, including the game they’re currently playing, or seek assistance if they encounter difficulties. Try asking Copilot for tips, guidance, or even video to help guide you through your next quest.”

Additionally, Microsoft announced, in collaboration with Meta (META), the launch of the Meta Quest 3S Xbox Edition. The Meta Quest 3S Xbox Edition limited edition release – the first limited edition ever for Quest – is part of Microsoft’s ongoing partnership and celebrates the expansion of Xbox Cloud Gaming (Beta) on Meta Quest headsets, the company said. The Meta Quest 3S Xbox Edition is available today for $399.99, and it comes loaded with everything players need to start gaming on a massive virtual display the moment they open the box. This bundle includes: Custom 128GB Meta Quest 3S in Xbox Carbon Black and Velocity Green; Matching Touch Plus controllers and a limited-edition Xbox Wireless Controller; Meta Quest Elite Strap; 3 months of Meta Horizon+, and; 3 months of Xbox Game Pass Ultimate.

All these stories come as Bloomberg’s Jason Schreier reported that the company will conduct another round of major layoffs in its Xbox division this week, with managers expecting substantial cuts across the entire group. This will be the fourth big layoff at Xbox within the last 18 months, and comes less than a week after Bloomberg reported that the company plans to also cut thousands of jobs, especially in sales, as part of efforts to trim its headcount amid heavy spending on AI.

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‘MARATHON’ DELAY: Last week, Sony’s Bungie, which previously developed games in the “Halo” and “Destiny” franchises, announced that it had made the decision to delay the release of its upcoming multiplayer shooter “Marathon” from its previously announced September 23, 2025 date. “The Alpha test created an opportunity for us to calibrate and focus the game on what will make it uniquely compelling-survival under pressure, mystery and lore around every corner, raid-like endgame challenges, and Bungie’s genre-defining FPS combat,” the studio said in a blog post. “We’re using this time to empower the team to create the intense, high-stakes experience that a title like Marathon is built around. This means deepening the relationship between the developers and the game’s most important voices: our players. Over the next few months, we’ll continue closed testing(including participants from the Alpha) to deploy gameplay updates and test new features as they come online.”

ROTH UPGRADES EA: Roth Capital upgraded Electronic Arts (EA) to Buy from Neutral with a price target of $185, up from $175. The firm cites increased confidence in Electronic Arts’ ability to execute and deliver double-digit earnings growth over the next three years for the upgrade. Sports remains a “blue-chip cornerstone” for the company’s growth story, but a successful release of a new Battlefield game “could materially change investor sentiment,” the analyst tells investors in a research note. Roth believes EA is at an “important inflection point,” setting it up well for an “elevated, multi-year growth trajectory.” It expects solid carryover and the company’s new initiatives will fuel another strong growth year in fiscal 2027.

OPPY RAISES ROBLOX PT: Last week, Oppenheimer raised the firm’s price target on Roblox (RBLX) to $125 from $80 and maintained an Outperform rating on the shares. Increasing content velocity, robust technology infrastructure, global reach, and a deep bench of under-utilized monetization features make Roblox a compelling investment, despite a 76% stock price increase since April 10, the firm says This week, Oppenheimer hosted virtual fireside chats with five top Roblox studios, including Splitting Point Studios, which turned Grow a Garden into the world’s most popular game in the past weekend. The firm came away incrementally bullish on Roblox’s sustainable user growth momentum, rewarded ad revenue potential, and long-term market share gain potential from other gaming platforms. It sees upside to Q2 and 2026 estimates.

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