Xbox misses Hi-Fi Rush success after pulling plug on 4 gaming studios

In the wake of Microsoft's recent closure of four of its gaming studios, Matt Booty, the head of Xbox Game Studios, addressed a town hall meeting to outline the division's forthcoming objectives and made a baffling statement.

"We're aiming for smaller-scale games that bring us acclaim and recognition," Booty conveyed to staff, as per internal statements disclosed to The Verge.

Xbox closed down the gaming studios including Arkane Austin, making it the latest publisher to cut costs as gaming hits a bump in the road.

This declaration came as a surprise to some participants, considering Microsoft's recent decision to shutter up Tango Gameworks, a Japanese developer known for their successful title, Hi-Fi Rush.

Hi-Fi Rush, which debuted unexpectedly last year, gained traction for its inventive gameplay and appeal. The rhythm-based action game featured tracks from renowned artists such as The Black Keys and Nine Inch Nails, besides visuals similar to the stylised aesthetics of PS2-era games.

Within just four months of its release, Hi-Fi Rush amassed a player base of 3 million. In addition, during the 2023–2024 awards season, the game claimed prestigious accolades including a Game Award, a Game Developers Choice award, and also a BAFTA.

While Microsoft is not coming clean on specific sales figures, there are indications that suggest the company was content with the game's performance.

Responding to the rumours indicating otherwise, Aaron Greenberg, vice president of Xbox games marketing, maintained on X that Hi-Fi Rush “was a break out hit for us and our players in all key measurements and expectations.”