Heading into the new year, it’s hard to tell what exactly the future holds for Xbox. Halo: Campaign Evolved, Gears of War: E-Day, Forza Horizon 6, and Fable should make this a solid year for its first-party games, but that’s not the part I’m fully worried about. Microsoft’s continued embrace of AI, the release of the Steam Machine, and the rising cost of hardware components like RAM are what leave me the most concerned for Xbox’s future as a hardware manufacturer.
It also doesn’t help that Xbox consoles aren’t selling well. Looking at sales data from November 2025, a month typically flush with game console purchases, you’ll see that Xbox Series X and S were not just outsold by PS5 and Nintendo Switch, but a cheaper, Kinect-like casual gaming device called the NEX Playground. If Microsoft can’t even beat that platform in 2026, it may not matter how good its games are.
Xbox was outsold by NEX Playground in November 2025
The tides are changing for dedicated console hardware
While the Nintendo Switch 2 had a strong launch, other game consoles had a weird 2025. PS5, Xbox Series X, and Xbox Series S celebrated their fifth anniversaries. Historically, consoles were heavily discounted and bundled with some of their best games by this point, but this generation of consoles are now more expensive than they were at launch. As a result, Black Friday discounts simply brought them back closer to their original price tags.
The Black Friday sales numbers for game consoles suffered as a result. Data shared by Circana’s Mat Piscatella on Bluesky shows that this November was the worst for physical game hardware since 1995. Nintendo Switch, Switch 2, PS5, Xbox Series S, and Xbox Series X all underperformed, though the Xbox consoles fared the worst. The Xbox Series consoles placed fourth regarding units sold in November, being outpaced by PS5, Nintendo Switch 2, and, most shockingly, the NEX Playground.
If you’re more of a hardcore gamer, you might not have heard of the NEX Playground. It’s a casual gaming device that uses a camera for motion control in several games, which are accessed via a subscription. Think of it as a modern version of the Kinect devices that Xbox experimented with in the early 2010s, with a cheaper version of Game Pass solely made up of family-friendly games.
It typically retails for $250, but you could pick one up for just $200 during Black Friday in 2025. The NEX Playground might not have been able to play Call of Duty: Black Ops 7 or The Outer Worlds 2, but it didn’t need to. Piscatella explained on Bluesky that a cheap, easy-to-use, subscription-driven, and family-friendly console filled a niche that no other console could in November. While NEX won’t topple Nintendo anytime soon, it should give Xbox reason to worry.
It’s embarrassing for Xbox to lose to NEX
Price and family-friendly content matter
Xbox Series X and S losing to NEX Playground in November 2025 stings because, in a lot of ways, NEX Playground is beating Microsoft at its own game. For starters, Xbox stopped supporting Kinect, and a decade later, the kid-friendly, casual gaming content that Kinect was perfect for is gaining popularity again. Almost all of Xbox’s recent first-party offerings haven’t been kid-friendly, making Xbox a less alluring choice for families during something like Black Friday.
More importantly, Xbox has also been beaten on price. Coming into the generation, Xbox seemed poised to win the affordability battle by offering both a powerful $500 console and a cheaper $300 that both give players tons of games with a $15 a month subscription. Over five years later, it’s clear the Xbox Series S and Game Pass experiments have failed, as they now cost $400 and $30 a month, respectively.
In comparison, NEX Playground’s $200 discounted price and $90-a-year subscription looked a whole lot more appealing. Xbox was already losing on the video game software front to Nintendo and PlayStation, and now even its hardware clearly can’t hold up against a casual-friendly gaming fad piece of hardware. That’s worrying, considering Xbox is still planning to release a next-gen console.
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We’ll learn how Xbox’s December (and 2025 as a whole) fared on January 22, when Piscatella releases Circana’s December 2025 sales data. We’ll also get a Developer_Direct highlighting this year’s lineup of games sometime this month. Both of those events should give us an even clearer idea of how to feel about Xbox as we head into the brunt of 2026.
2026 should give clarity to Xbox’s uncertain future
Will a next-gen Xbox console even be worth it?
There are no easy answers for Xbox right now. It bet big on purchasing studios, funneling first-party games into Game Pass, and offering multiple console SKUs at different price points. All those efforts still kept them in third place this console generation, and now it even seems to be losing ground to a device most gamers weren’t even familiar with until it started beating Xbox.
2025 was the year Xbox fully embraced being a multiplatform game publisher and seemingly ceded its efforts to become the number one gaming software and hardware maker. 2026 will be a real indication of what Xbox will look like going forward and if it can put up a fight against new challengers like the NEX Playground and Steam Machine. By the end of the year, we’ll probably be able to tell if it’s even worth it for Microsoft and Xbox to release a next-gen console in 2027.
