Blizzard finished fiscal year 2026 as the top-performing studio within the Xbox studios division, according to a leaked internal email shared by Windows Central. Blizzard president Johanna Faries attributed the milestone to consecutive quarters of growth, marking the studio's third-highest fiscal year for top-line revenue in its history.
Quick Facts
- Blizzard operated as Xbox's top-performing studio in FY26.
- Diablo 4: Lord of Hatred and Overwatch drove exceptional performance.
- Overwatch recorded its strongest quarter since 2022 during this period.
- Activision and King saw a slump in FY26 due to the launch of Call of Duty: Black Ops 7 and difficulties with Candy Crush.
Drivers of Growth: Diablo 4 and Overwatch
Faries noted that FY26 marked the first time in a decade that Blizzard experienced consecutive quarters of growth. Specifically, Diablo 4: Lord of Hatred and Overwatch fueled this momentum, with the latter delivering its strongest quarter since 2022.
Studio Impacts and Wider Xbox Performance
While Blizzard celebrated record-adjacent revenues, the broader Xbox division experienced turbulent financial and operational shifts during FY26. Activision and King faced a slump, driven by the disappointing launch of Call of Duty: Black Ops 7 and struggles for Candy Crush.
Concurrently, wide-scale layoffs occurred across Xbox, leading to studio spin-offs such as Double Fine operating independently, followed by subsequent cuts. Despite its financial success, Blizzard was not entirely exempt, facing "comparatively minimal" cuts of its own.
Elsewhere in the Xbox portfolio, Minecraft developer Mojang continued to generate significant profits used to fund the rest of the gaming lineup. However, following criticisms that Xbox under-invested in the property, Mojang will now report directly to new leadership under CEO Asha Sharma.