If there was one takeaway from the Xbox Games Showcase on June 8th, it is that there is no holding back on Obsidian Entertainment. Microsoft acquired Obsidian Entertainment in November 2018. Since then, only Grounded and Pentiment have been released (this excludes The Outer Worlds since this was originally published by Private Division). However, this most recent showcase by Xbox shows that Microsoft now seems to be leaning into Obsidian Entertainment’s successes, taking them off the bench and letting them run forward to become a standout AAA studio.
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The original acquisition of Obsidian Entertainment by Microsoft came without any major concerns. It came at a time when consoles were heavily looking for exclusives to offer on their platform. However, once Microsoft acquired ZeniMax Media, which includes Bethesda Game Studios, a red flag was drawn into play.
The red flag: both Bethesda and Obsidian Entertainment have a strong pedigree in open-world RPG games. Bethesda has produced some of the most iconic open-world RPGs of the last decades, like The Elder Scrolls V: Skyrim and Fallout 4. Likewise, Obsidian has been developing games of a similar nature, like Fallout: New Vegas and The Outer Worlds. Can two studios exist in Xbox Game Studio’s portfolio that produce games of a similar nature? Or would one studio be cannibalized by another?
At first glance, it appeared that a higher stake of interest was placed on Bethesda’s pipeline. Since the acquisition of Bethesda in 2021, the label has published six titles, including Deathloop, Ghostwire Tokyo, Hi-Fi Rush, Redfall, Starfield, and Indiana Jones and the Great Circle. By comparison, since 2018, only Grounded and Pentiment have been launched as part of Xbox Game Studios’ portfolio. That was until 2025, when it became significantly more apparent what Obsidian Entertainment was working on.
In 2025, Obsidian reminded audiences of its caliber as a studio with not one, but three major releases planned for the year (assuming there are no delays). Already, Avowed was released in February and, according to mindGame data estimates, reached 5.9 million players in one month post-launch and a peak of 20K concurrent players on Steam. In comparison, Bethesda’s Indiana Jones and the Great Circle potentially only reached 4 million players and 12K peak concurrent players. In all respects, outside of Metacritic scoring, Avowed performed much stronger as an Xbox success story.
Coming to the rest of the year, Grounded 2 is planned for release on July 29th as a follow-up sequel to the success of Grounded, released back in 2020. The features desired to be built into Grounded could no longer be supported by the game and warranted a sequel and a move to Unreal Engine 5. Some of those new features include mountable bugs, an omni-tool to reduce inventory clutter, and a dodge mechanic.
Separately, The Outer Worlds 2 was also announced to be released on October 29th, 2025. The original The Outer Worlds was a commercial success, selling over 5 million copies worldwide when it was published by Private Division. The success of The Outer Worlds potentially begets that the follow-up sequel will likely reach similar levels of success, especially considering that The Outer Worlds 2 will be available at launch across all major platforms. However, a new point of consternation is that The Outer Worlds 2 will be the first title from Xbox Game Studios that will launch with the $79.99 price tag that is rapidly becoming the new norm in AAA pricing.
Given the performance of Avowed and the historical performance of Grounded and The Outer Worlds, 2025 is line to be a very successful year for Obsidian Entertainment and, vis-à-vis, Xbox Game Studios. In contrast, Bethesda launched a very successful remaster of The Elder Scrolls IV: Oblivion, but fans remain disappointed with the lack of news about Fallout and The Elder Scrolls, which haven’t seen a mainline sequel release from either franchise in over ten years.
