Kojima PrODuctions’ OD, the Xbox-backed horror project, reportedly made it through Microsoft’s 2024–2025 cuts, according to several reports, even as the company keeps reshaping its gaming business.
Those same reports say the Kojima Productions game is still moving ahead under Xbox through the 2024–2025 cuts. That’s happening while at least five studios are reportedly facing closure or a sale, IO Interactive’s publishing deal for Project Fantasy has reportedly been dropped, and neither Microsoft nor Kojima Productions has publicly confirmed where OD stands.
For anyone watching Xbox closely, OD looks like one of the clearest projects to survive. Sources cited by established outlets say Microsoft is treating it as a prestige exception. The reasoning is pretty easy to follow: Kojima Productions is attached, Jordan Peele is involved, the project has marquee value Microsoft may want to keep inside its own ecosystem, and the cloud-based concept was originally pitched as a showcase for Microsoft tech.
The pressure behind these cuts is hard to miss. Reports point to Microsoft’s fiscal Q3 2026 gaming revenue falling 6.6% year over year, with Xbox hardware down 33%. Other reports cite an internal memo saying annual gaming revenue had fallen by nearly $500 million over five years. Margins were said to be around 3%, and Microsoft has already gone through thousands of layoffs.
If you were worried OD might be next, this is at least a sign it may not be, though nothing official has been said yet. Hideo Kojima has said other companies thought the idea was too “crazy,” but Phil Spencer’s Xbox went for it. For now, OD is still an Xbox project.
Author: Jesús Bosque
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