5 Years After Launch, the Xbox Sequence X Is an Afterthought. So What’s Subsequent?

Five years ago today, the Xbox Sequence X sought to reimagine what the time period “Xbox” even was. Again then, the massive, black, boxy console promised gamers they might get peak efficiency for couch-based gaming for the low worth of $500. In 2025, that console with the optical drive now costs $150 greater than it did in 2020, and it has been eclipsed by the newest gaming-ready PC chips many instances over.

Microsoft’s Recreation Move mannequin, which rose together with the Sequence X to grow to be the very best deal in gaming, now costs greater than ever if you’d like the very best options.

All of it looks like grim tidings, however there’s extra at stake than a model. Xbox is attempting to drag the entire games industry business into a brand new id, the place exclusivity and first-party {hardware} just like the Sequence X matter lower than the video games themselves.

Positive, Halo is coming to PlayStation 5 and Gears of War is already on the console, however Xbox isn’t going wherever. It may nonetheless lower by the clamor and show the naysayers flawed.

“What they’re making an attempt to do is blow up the normal gaming framework,” Circana’s main online game business analyst Mat Piscatella instructed Gizmodo over e-mail. “The important thing query is that if gamers might be prepared to associate with that change.”

When a trickle of unhealthy information turns into a flood, it may appear close to inconceivable to see any vivid spot of hope. With the transfer towards a subscription-based gaming panorama, we personal much less and develop extra depending on digital platforms. We endure on the whims of the platform holders, unable to do something however roll our eyes on the inevitable means of enshittification. Then there’s the latest drama from Bloomberg’s report claiming Microsoft has positioned a 30% profit margin mandate throughout its Xbox model, which is manner above the business customary. The report places the Xbox’s latest actions into perspective.

Harping on these ache factors is much less like beating a lifeless horse, and extra like kicking the shins of a poor, hobbled creature who’s pushing itself tougher than anyone else. The Xbox model remains to be alive regardless of the crushingly dour outlook of the fanbase. Xbox may make the case that exclusivity has no place in our fashionable gaming panorama. Whereas the vast majority of avid gamers can be wonderful streaming their titles from residence, there might be a devoted subset of avid gamers who would pay by the nostril to get the best possible gaming {hardware} there’s with out funneling hundreds of {dollars} right into a gaming PC.

Xbox wants a plan. Higher but, it must raise the lid on its plans if it needs gamers to get on board with its makes an attempt to fully flip the script on gaming.

How did we get right here?

The Xbox is philosophically distinct from each different console available on the market, and that knowledgeable what ultimately grew to become the Xbox Sequence X. The designers behind the unique Xbox console again in 2001 wished to take what was basically a Home windows PC and plug it into the lounge. The system used Microsoft’s personal DirectX know-how and ran on equal pc elements. Finally, that “DirectX Field” grew to become, merely “Xbox.” Just some years after launching its authentic console, the corporate discovered large success with the Xbox 360. It was a console with a lifespan that lasted practically 11 years, turning into the corporate’s best-selling system. Microsoft solely killed off the Xbox 360 store in 2024.

Microsoft’s follow-up, the Xbox One, launched with a heavy deal with multimedia. In 2013, Microsoft emphasised the console as an “all-in-one residence leisure system” and stored citing Reside TV as a killer characteristic. The console suffered from quite a few controversies, like that notorious try to require an web connection, restrict gamers’ talents to purchase used video games, and drive customers to hook up a Kinect. Former Xbox Senior Vice President Don Mattrick told players, “Fortuitously, we have now a product for individuals who aren’t in a position to get some type of connectivity. It’s known as Xbox 360.”

After a big C-suite shakeup that noticed the rise of Phil Spencer—now the CEO of Microsoft Gaming—Microsoft launched two consoles on Nov. 10, 2020. The Xbox Series S was a lower-end console constructed for enjoying Recreation Move titles and fashionable video games at 1440p decision. The massive daddy, the Sequence X, was essentially the most “box-like” Xbox the corporate had ever devised. Microsoft promised it was designed for 4K gaming, packing within the each AI upscaling and ray tracing capabilities to make video games play and look their greatest.

The factor we frequently neglect in regards to the Xbox Sequence X is how a lot it was a continuation of Microsoft’s authentic pitch manner again in 2001. The console is filled with PC guts, even when it doesn’t really feel like all form of Home windows machine. And but, it’s a strong console for its worth due to its customized 8-core, 3.8GHz AMD processor constructed on what was then the still-relatively new Zen 2 CPU and RDNA 2 microarchitecture. The console promised double the FLOPS (floating level operations per second) in comparison with the Xbox One. It got here with 16GB of quick GDDR6 RAM for shorting loading instances and a full 1TB SSD to carry the rising dimension of next-gen video games. The storage was greater than the 825GB SSD within the authentic (and most up-to-date) PS5. The Xbox Sequence X internals are particularly attention-grabbing—not less than for {hardware} nerds like yours really. In interviews, designers like Xbox’s Director of Mechanical Engineering Jim Wahl talked about how the console’s cut up motherboard design allowed it to direct cool air onto all parts in a gentle stream.

The Xbox Sequence X was a tall tower of gaming potential, although this console technology lacked most of the big-name titles that will get gamers to hurry out for the newest {hardware}. Halo Infinite didn’t arrive till late 2021. The video games which have come out since 2020 haven’t caught round on Xbox’s personal console, both. Titles like Forza Horizon 5 are actually on PS5. More moderen titles like Indiana Jones and the Great Circle hit Sony’s console in April this 12 months.

Microsoft doesn’t reveal the entire variety of console shipped or bought. Nonetheless, greatest estimates present the Xbox Sequence S and X has shipped round 30 million models complete as of February 2024. To place that quantity in context, the PS5 has shipped round 80 million models worldwide as of November 2025, and the unique Swap has shipped over 154 million consoles as of September 2025, although Nintendo launched its system in 2017. Xbox console income has declined precipitously over the previous 12 months in comparison with PlayStation 5. After worth hikes, the PS5 truly noticed a bump in complete gross sales. In Microsoft’s latest quarterly earnings report, Xbox {hardware} gross sales had been down 22% year-over-year.

The place’s the mid-cycle Xbox?

There was no signal of a mid-cycle refresh console, like Sony did with its PlayStation 5 Pro to enhance its (now) $550 PS5. Leaked documents from Microsoft’s authorized battle with the Federal Commerce Fee confirmed the corporate had not less than drawn up designs for a mid-generation system known as “Brooklin.” That rounded Xbox hasn’t materialized. The closest we ever received was a brand new disc drive-less model and a Galaxy Black Series X with redesigned internals and 2TB of storage (that console now prices $800). The primary actual {hardware} in 5 years past one other controller colorway is the $1,000 Asus ROG Xbox Ally X, a terrific handheld PC however not one thing the console crowd may simply get used to.

Calling the Xbox Ally X handheld an “Xbox” confused gamers who imagined they might obtain a console-like expertise. Individuals who labored on the unique Xbox, like Seamus “father of Xbox” Blackley, said, “Is it truly only a branded laptop computer with joysticks?” The hand-held’s UI remains to be unfinished. There are some menus on the Xbox app that don’t work properly with a controller. There are different main points with the Xbox Ally X going to sleep when in recreation that may trigger it to not restart. One of many authentic founders of Xbox Recreation Studios, Laura Fryer, is a constant critic of Xbox’s newest strikes. In a recent video, she said the Xbox Ally forgets the basics of UX—or consumer expertise—the place “time is the true foreign money, not money.”

The subsequent-gen Xbox might have a UI very like the Xbox Ally. During which case, the hand held is barely a beta for what comes subsequent. The Asus-made handheld was by no means going to be an actual Xbox. It’s merely a continuation of traits with at present’s handheld PC gaming gadgets. Brian Crecente, president of online game consulting firm Pad and Pixel, stated that Microsoft’s advertising surrounding the hand held solely led to extra confusion, particularly when it stored attempting to persuade avid gamers that each PC can also be an Xbox.

“That shift is one thing they hold attempting to do, and it retains blowing up of their face,” Crecente, who was additionally the previous editor-in-chief of Kotaku (now, sister site to Gizmodo once again) and a cofounder of Polygon, instructed Gizmodo. He’s been witness to Xbox’s many successes and foibles.

“The panorama of gaming is on the verge of seismic change,” Crecente stated. “When you’ll be able to play Halo on a PlayStation and God of Battle on a PC, you understand issues have modified,” Crecente stated. The one query is whether or not Xbox is appropriate to refocus on being an uber writer, particularly when its guardian firm calls for such excessive revenue margins that studios can’t presumably match.

Any next-gen Xbox demands a UI that works. In that manner, Valve is already far forward of no matter is going on at Microsoft. Valve’s Linux-based SteamOS software program is less complicated to navigate on handhelds, and it might be coming to extra gadgets like a VR headset or a PC-like console. Microsoft “has at all times been chasing Valve,” online game researcher and NYU Stern Faculty of Enterprise professor Joost van Dreunen instructed Gizmodo. It’s a smaller, extra agile firm run by ex-Microsoft programmer Gabe Newell. Steam—which most builders think is a monopoly—makes a lot cash, you would contemplate it a yacht factory for the Valve CEO. It’s not prone to promote out to Microsoft or anyone else any time quickly.

Xbox publishing karma is far and wide

All this hubbub round {hardware} ignores what Xbox has been really specializing in: the video games. Earlier this 12 months, Clair Obscur: Expedition 33, a recreation that harkens again to old-school JRPGs with a French aptitude, grew to become a sizzling success regardless of being developed by a small staff of simply 30 individuals. An enormous cause Clair Obscur: Expedition 33 blew up was as a result of Xbox promoted it in 2024 and introduced it to Recreation Move in 2025. As Stephen Totilo wrote in his recent Game File newsletter, Microsoft revealed a dizzying array of nice titles, together with RPGs like Avowed and The Outer Worlds 2, shooters equivalent to Doom: The Dark Ages, and smaller indie titles like South of Midnight and Keeper.

The “Xbox Sequence” {hardware} was altogether attention-grabbing, although ultimately the PlayStation 5 and Xbox Sequence X had been basically tied for efficiency. Nintendo was off doing Nintendo issues, making financial institution on its cheaper $300 Nintendo Switch dockable handheld. Even 5 years in the past, the console wars had been successfully already of their loss of life throes. Video games within the fashionable period price greater than ever to develop. Lead instances are longer, and AAA advertising budgets alone can dwarf mid-sized initiatives. With rising prices, main first-party publishers can’t think about making a revenue except their video games are on each platform out there.

“For the longest time, the narrative round gaming has been about higher, sooner, greater [hardware], when actually it’s the video games,” Joost van Dreunen stated.

It was round this time two years in the past that Microsoft accomplished its $68.7 billion buyout of what was then one of many largest publishers on the scene, Activision Blizzard. The acquisition promised to place Name of Responsibility on Recreation Move, however shortly after making the deal closing the Microsoft laid off hundreds of staff. Microsoft has continued firing thousands of staff within the 12 months since. Microsoft killed the long-awaited Excellent Darkish reimagining and axed its developer, reportedly laid off employees from a number of Name of Responsibility co-developers Raven Software program and Sledgehammer Video games, canceled a brand new MMORPG from the developer of Elder Scrolls On-line, and harm quite a few different small indie builders.

It’s inconceivable to say the place the needle falls on Xbox’s karma for 2025. It introduced us a number of video games from small and massive studios alike, and simply as simply dismantled many extra studios and fired the employees creating these video games.

We now have to speak about Recreation Move

At launch, what actually differentiated the PS5 and Xbox consoles was Recreation Move. Microsoft’s gaming subscription mannequin would quickly grow to be the spine of Xbox’s total gaming technique, one which eschewed exclusivity in favor of turning into a form of “Netflix of video games.” This included crossplay options to allow you to purchase video games on Xbox and play them on PC and even your telephone. Over time, this might morph into the “Xbox in all places” technique, which is why you now see these annoying adverts attempting to persuade you that “every part is an Xbox.”

Recreation Move steadily grew to become costlier through the years, however these worth will increase had been insulated due to new options. The massive promoting level for the subscription is entry to a mess of nice video games from Xbox previous and current. Moreover, Xbox Cloud Gaming would let avid gamers who paid extra play a number of massive titles by streaming them from the cloud. That characteristic was known as a “beta” for years till its most-recent 2025 replace. The opposite massive promoting level for the best “Final” tier was “day one” video games. Now, to get entry to the newest Name of Responsibility and different AAA titles on launch day, that you must spend much more ($30 as a substitute of $20) to get entry.

Microsoft makes most of its cash by promoting companies like Home windows 11, 365, or Azure to companies. Xbox is essentially the most consumer-facing model of its total product stack. “It’s a little bit of a tragic factor,” van Dreunen stated. “You’re attempting to be the good home on essentially the most boring block.”

Xbox is the one piece that doesn’t gel with the remainder of Microsoft’s enterprise. That’s why the reported 30% margins would solely make sense from any person who doesn’t comprehend the gaming business. In any case, Xbox might be a brand new solution to shove Home windows in entrance of much more gamers and struggle again towards the ever-encroaching Valve.

It’s all in regards to the field. Which implies Xbox nonetheless wants some kind of {hardware} to make a case for itself. Based on leaks, the next-gen Xbox, dubbed Project Magnus, could have a strong customized AMD chip that dwarfs what’s going into the next-gen PlayStation console. That has {hardware} aficionados speculating the system may simply price round $1,000 or much more.

This might be a “enterprise class” console for gamers who merely need the very best, in keeping with van Dreunen. Everybody else could make due on different gadgets, and never simply your good TVs.

Xbox will want one thing massive for 2026

Xbox is finished with exclusives. It’s made that completely clear. However whereas Xbox has been extra verbose on the matter, PlayStation is making related strikes by sticking its once-exclusive video games on PC. The next-gen PlayStation may emphasize similar cross-play features as Xbox has, the place gamers can purchase their recreation in a single place and decide up their save whether or not they’re on console or one other system. Nintendo remains to be the one one selling exclusivity each in first- and third-party titles. Contemplating the staggering rate of Switch 2 gross sales, it’s not doing half unhealthy sticking with what works.

Van Dreunen stated that whereas different gaming firms like Take-Two Interactive can delay video games like GTA VI on a whim, as a result of that’s their total enterprise, Xbox isn’t constructed for that. Xbox as a model makes up such a small a part of Microsoft, but it surely means the corporate thinks of its enterprise by way of decade to decade, not 12 months to 12 months. It should analyze its success if it may hit 100 million Recreation Move subscribers by 2030, as leaked documents instructed was the corporate’s hopes. In fact, if it was getting wherever near that quantity, Xbox would have stated one thing by now. Xbox has not relayed something official about Recreation Move subscriber numbers since February 2024, when the quantity sat at 34 million.

“It gained’t actually matter what number of Xbox-branded console gadgets they’ll promote sooner or later in the event that they’re in a position to generate gamers and engagement by its different ecosystem entry factors,” Piscatella instructed Gizmodo. “However, once more, the query is that if online game gamers will associate with it.”

“I’m unsure Xbox is aware of what makes Xbox nice,” Fryer stated in a video criticizing the massive October Recreation Move worth hike. Fryer stated that the Xbox console wasn’t about promoting {hardware}, however about making a “closed loop” the place the corporate can create each a buyer and developer relationship. That Xbox “life-style,” as Fryer put it, can’t exist when gamers are taking their video games to no matter system they might select.

Microsoft isn’t altering course, and Xbox’s main plans gained’t come to fruition for not less than one other 12 months, not less than. With cloud gaming and Recreation Move, {hardware} doesn’t matter practically as a lot. Xbox might be coming to the purpose the place it solely sells {hardware} as a premium choice. Microsoft has lengthy relied on OEMs, or authentic tools producers, for its PC enterprise. Piscatella instructed Gizmodo that Xbox might be edging towards a future the place it could create its personal prototypical gadgets, counting on firms like Asus to make the {hardware}. This might be the identical manner Microsoft leads with its Surface PCs, and its companions kind of reference its designs.

In prior years, gamers had been all too able to decry the state of exclusivity. {Hardware}-specific video games stranded poor gamers on single-console ecosystems. It stored avid gamers from appreciating the true breadth of what sort of artwork was on provide. No, avid gamers as a demographic won’t ever be blissful, particularly not with change.

Xbox can be higher off if it may grow to be extra clear. Xbox President Sarah Bond has been making the rounds to speak in regards to the console, however the lack of particular data is making longtime avid gamers antsy. PlayStation has hosted a number of hearth chats with AMD to speak up its future plans, however Xbox can go one step additional. It could possibly begin constructing hype for its next-gen console now. It could possibly speak up what sorts of advantages gamers will get for sticking with Xbox {hardware}—if not unique video games, then unique capabilities that the Sequence X by no means had and by no means will.