An internal letter from Joanna Faris, reviewed by Windows Central, put everything into perspective: Blizzard closed the fiscal year as the top studio in the Xbox division. The $68.7 billion spent on the 2023 acquisition of Activision Blizzard is starting to pay off—and this despite Xbox itself declining 11% year-over-year.
This is hardly a coincidence. Blizzard posted quarterly growth for the first time since 2016, and FY26 was its third-highest revenue ever. And all this without a single major release, solely thanks to expansions and the live service.
There are three main drivers. Overwatch experienced a much-requested change: the studio removed the “2” from its name, and in February, it rolled out five new heroes—an unprecedented feat. The result: its strongest quarter since 2022. Diablo IV: Lord of Hatred (released at the end of April) has revived interest in the endgame, while World of Warcraft, despite narrative controversies, maintains a record pace of updates.
This success contrasts sharply with the layoffs at Microsoft itself. Over the next 12 months, 3,200 people will leave Xbox, and 4,800 across the company. Compulsion Games, Double Fine, Ninja Theory, Undead Labs, id Software, Bethesda, and Arkane were hit. Blizzard, however, appears to have suffered minimally—if there was a decline, it was not comparable to its neighbors.
Then, BlizzCon 2026 kicks off in Anaheim on September 12-13. Rumor has it that the next WoW expansion, “The Last Titan,” will be announced there with confidence. Faris herself called the event “a springboard into a new era,” meaning we can expect not only esports tournaments but also significant investments in future projects.
In short: Microsoft’s investment was worth it. Blizzard has succeeded where other studios have struggled, and now it has the resources to cement its place at the top. Stay tuned for BlizzCon—it’s going to be a blast.
