Microsoft's Xbox forms XP division; Bloomberg reports Arkane approaches
Kayleen Walters, former head of Mojang Studios, will lead XP, which covers film, merchandise, parks and partnerships.
Microsoft announced on October 8 the creation of a new division called XP, which will extend the company's game franchises into films, television, merchandise and theme parks. According to 4gamer.net, the unit is split into four businesses: XBOX PICTURES for film and TV adaptation, XBOX PRODUCTS for merchandise, XBOX PLACES for theme parks and live events, and XBOX PARTNERSHIPS for corporate and brand deals.
Kayleen Walters, who previously led Mojang Studios, was appointed to head the XP division. XBOX stated that its goal is to become the world's number one entertainment company.
Separately, on November 3, Bloomberg reported that at least three companies, including Ubisoft, have proposed acquiring Arkane Studios from Microsoft, and that a sale of the studio to its own management is also under consideration.
The reports come as Microsoft proceeds with layoffs and restructuring affecting 3,200 people, after 1,900 job cuts in 2024. In August 2026, Compulsion Games and Double Fine Productions were returned to their management along with rights to their IP and past work and operating funds; in September 2026, Undead Labs became an employee-owned independent studio while retaining the rights to State of Decay.
Arkane's recent history
Arkane Studios came under ZeniMax Media in 2010. Arkane Austin's Redfall underperformed in 2023, and the studio was closed the following year. In July 2026, the Lyon studio developing Marvel's Blade became subject to consideration of options including a sale as part of restructuring.
Quick answers
What is Microsoft's XP division?
It is a new XBOX division announced on October 8, made up of XBOX PICTURES, XBOX PRODUCTS, XBOX PLACES and XBOX PARTNERSHIPS, covering film and TV, merchandise, theme parks and events, and brand partnerships.
Who leads the XP division?
Kayleen Walters, the former head of Mojang Studios, was appointed to head XP.
Is Microsoft selling Arkane Studios?
Bloomberg reported on November 3 that at least three companies including Ubisoft have proposed acquiring Arkane Studios, and that a sale to the studio's management is also being considered. No sale has been confirmed.