RESOLVING THE LEDGER
This is one outlet's own report from IGN — the article as it was filed. Other outlets are covering the same event; open the full story to compare every source side by side.
See the full story · 3 sources
Blizzard Entertainment is reportedly Microsoft's golden child after Overwatch and Diablo 4: Lord of Hatred helped it become the "top-performing" Xbox studio.
The World of Warcraft game developer's president, Johanna Faries, celebrated its status in leaked emails reported on by Windows Central . On the heels of a lackluster earnings report for Xbox, she was said to have told staff that Blizzard is firing on all cylinders.
"In FY26 Blizzard ended the year as the top-performing studio in Xbox's studios division," Faries' leaked emails stated, "and this past year has marked our third highest fiscal for top line revenue in Blizzard's history."
Blizzard's president then went on to confirm that FY25 and FY26 marked the studio's "first back-to-back years of growth since FY17." That's nearly 10 years without that kind of growth brought to an end thanks to two games in particular.
Blizzard oversees a wealth of IP, but only two "drove exceptional performance" in particular: Overwatch and Diablo 4: Lord of Hatred. The latter, the second DLC expansion for 2023's Diablo 4 , launched in April of this year. It built upon its critically acclaimed action-RPG dungeon-crawler foundation with more story content, a new region, the Paladin and Warlock classes, and more.
Through even its most controversial moments, Diablo remains one of Blizzard's strongest performers. Overwatch, meanwhile, has fluctuated in the 10 years since its launch, but recent years have shown the studio is willing to put the work into the hero shooter to not only keep it going but make it better than ever.
The last two years have seen Blizzard deliver resets for Overwatch. It first began in 2025 with the return of loot boxes and the new perk system , while 2026 dropped the "2" to pick up the slack with 10 new heroes for the year and loads of quality-of-life updates. Was it all worth it? Faries seems to think so, with Overwatch recently boasting "its strongest quarter since 2022."
Faries said its recent wins will help "shape Blizzard's future," which, for now, largely remains a mystery to the public. Windows Central also reported that the company is working on mobile spinoffs and trans-media projects for some of its franchises, while work on the next main Diablo project progresses. Although nothing has been officially announced, BlizzCon 2026 will hopefully offer a peek behind that curtain when it arrives September 12 – 13, 2026.
"It's my hope that the event can shine a light on the work underway at Blizzard," the email continued, "and that it can serve as a powerful springboard into a new era of momentum and excitement behind our mission to bring joy and belonging for communities worldwide."
Xbox, which also encompasses massive IPs like Call of Duty, Fallout, The Elder Scrolls, Halo, and more, is otherwise going through a historic rough patch. Following CEO Asha Sharma's promise to " reset " the brand, Microsoft has announced layoffs that will affect 3,200 staff when all is said and done. As Microsoft sheds gaming studios and attempts to refocus on its core IP , one id Software developer has put Xbox on blast , saying executives at the company "fundamentally don't understand art."
Michael Cripe is a freelance writer with IGN. He's best known for his work at sites like The Pitch, The Escapist, and OnlySP. Be sure to give him a follow on Bluesky (@mikecripe.bsky.social) and Twitter (@MikeCripe).
AIPROPX is an independent multi-source news index — we track, compare, and connect coverage from across the web into one place you won't find anywhere else.