Destructoid Checkpoint: Ubisoft, Hytale, and the possibility of next-gen console delays

We didn’t even make it into the first month of 2026 before two of the most popular stories from last year repeated themselves. A breakout hit has already taken gamers by storm, and we’ve had layoffs and game cancellations. 

Honestly, the games industry sometimes moves so far that it can be hard to find the energy to treat the highs and lows with the gravitas that they deserve, so let’s try and do a good job this year of knowing and recognizing when big things are afoot. 

Ubisoft Restructuring

Ubisoft has been firming in deep water for a while now. They have had a generational run of underperforming titles, and it has left their studios stretched thin and their books unbalanced. The solution, unfortunately, was to cut some projects, close some studios, and double down on the things that worked. 

The company has opted to close studios in Nova Scotia, Halifax, and Stockholm, with restructuring (that means layoffs) also hitting the United Arab Emirates, Helsinki, Malmo, and Abu Dhabi. On top of that, six different games have been cancelled, including the ill-fated remake of Prince of Persia: The Sands of Time. 

The plan is to focus on established IPs rather than develop new ones, with developmental muscle devoted to open-world and live-service titles.

It’s a painful start to the year for all those affected, and further evidence that Ubisoft is struggling to get ahead of the market changes. The main reason for that is a consistent failure to understand the position that their audience actual find themselves in. 

As originally reported in The Wall Street Journal, a study by Circana has found that young folks are spending less on entertainment, especially video games. The reason for this is not hugely complex; they just don’t have much money. Rising costs of everything from rent, utilities, and essentials mean there is little room left for entertainment, but much of the games industry is still stuck in that 2020 mentality, assuming infinite wealth exists to be farmed from the pockets of gamers.

It does make you question the validity of Ubisoft’s strategy to focus on high-cost titles that involve open worlds and long-term support, but they will at least be basing that on internal metrics that show them where they get their greatest returns from, I hope. 

Hytale is winning

As predicted, Hytale is off to a great start, but one thing I didn’t predict was just how big that would be. The team at Hypixel has already achieved north of three million unit sales and has secured the game’s development budget for at least another two years. 

As for the game itself, it’s everything that Hypixel promised, in that it is very early in development. All the fundamentals are there, but outside of the resource chase, there is little to do right now. That is absolutely fine, however, as this is precisely what Hypixel said the game was. If anything, they begged people not buy in right now, people just did it anyway.

Part of that would have been genuine curiosity to see what state the game was in. Hytale fans have watched from the sidelines as the game was snapped up by Riot, only to end up in developmental limbo when Riot couldn’t seem to get things rolling the way they wanted to. 

Now it’s back with Hypixel, the team's original vision is being played out, with PC being used as a test bed for development, thanks to the ability to easily and quickly drop patches and updates, getting new content out and balanced in a way that just wouldn’t be possible on consoles. 

I can only assume the aim is to build, polish, and then reap the rewards with releases on Xbox, PlayStation, and the Switch when the time is right, which is certainly not a bad plan. We’ll be keeping a close eye on Hytale over the coming years to see if the early promise pays off, or if the whole thing struggles to find a consistently engaging connection with fans.

The great big console question

Last year, I talked a lot about the rising prices of GPUs and RAM, largely driven by the rush for AI. We are now coming to the point where this might have a knock-on effect on the console market, resulting in a delay of the next generation. 

While strictly in the theoretical zone right now, the industry has given no hints that this might happen, but it’s always fun to speculate. Price point has always been incredibly important for consoles. Go too low, and the manufacturers eat too much of the cost, weakening their overall generational performance and forcing a reliance on selling units of games to make up the margins. 

If they price it too high, it limits how many people can cross the generational rubicon anyway, and a loss of hype at the start of a generation can be really hard to come back from, although not impossible. There is very rarely a good time to launch what is, ultimately, a luxury product, but things are looking decidedly horrible right now. 

The continued rise of component costs shows no signs of slowing as GPU and RAM manufacturers make the smart business move of abandoning consumer products to focus more on filling the needs of the AI companies. While juggernauts like Google and Microsoft are planning long-term moves to their own AI chips, that move won’t come soon enough to relieve the pressure on current supply.

You also need to consider the simple reality that Sony and the Xbox division of Microsoft cannot compete with the AI companies on the price of these components right now. They must run at a profit; the AI companies do not have that need, not right now. While you can see signs of some, such as OpenAI, getting itchy and experimenting with ads, the rat race is firmly in “burn it till you earn it” mode.

AI companies are currently in a period when they don’t really need to make much money. They are powered by venture capital money, benefit from often sleazy relationships with assorted government figures, and sometimes they gain investment from the very companies that are producing their chips in a weird ouroboral relationship where the AI snake is pretty much just puking money up its own butt.

The only thing that matters for these companies right now is surviving, being the last one standing, and then turning the screws on the consumers who have no other choice but to engage with their products. 

This luxury does not apply to PlayStation, Xbox, and Nintendo. Their market is firmly established, their rankings largely enshrined in stone. They must make money. PlayStation is Sony’s most profitable division, which means it can’t take a hit that has a negative impact across the rest of the business. Xbox is the baby brother of Microsoft, so it can’t even compete with the rest of the business for manufacturing space. Nintendo is currently clear of the mess, with their mid-generation release of the Switch 2, but they can still get caught up in the churn if prices keep going up, impacting console prices.

It may just make sense to delay the next generation until prices stabilize, and that is before we even look at the overall cost of living increase that people are currently shouldering, uncertain tariff situations, and other areas of volatility. 

Frankly, my current view is that this would just be good for consumers. I feel like the current generation has the muscle to still do good work, and I find it unlikely that the ceiling of optimization has been reached, so you could easily get a couple of extra years out of the hardware. 

Now, it seems somewhat unlikely that the delay will occur, as new console generations are hugely valuable financial years to the manufacturers, and if they feel they can use the current pricing situation to squeeze consumers, then, as much as I hate to say it, they likely will. 

I suggest we all go back to reading books. 

What’s happening, Destructoid?

Last week, we talked about video game movies becoming pretty good these days, but there will always be room for stinkers. Andrej Barovic talks about how even the worst of them can still attain cult status. - “Whenever Silent Hill (the movie) first came out, video game adaptations didn’t have the best track record. Most of them were attempts at making a quick buck over this “new craze with the kids,” with little thought, care, or effort put into actually capturing the essence of the source material. What made the games great never translated to the silver screen, and Silent Hill was no exception.”

Tiago Manuel takes a look at Expedition 33, and notices something that he never spotted before. - “Now, you likely belong in one of two groups: the players who are reading this and thinking “wtf?”, or those who’re finally feeling vindicated, wondering why no one else is talking about it.”

Rachel Samples brings a review of MIO: Memories in Orbit, and fell in love with the mystery. - “There’s a particular kind of magic in games that refuse to explain themselves; those that throw you in an unfamiliar, dimly lit environment and expect your curiosity to take the reins. MIO: Memories in Orbit is exactly that, a game about navigating strange surroundings, poking at forgotten corners, and slowly realizing that every small step you take brings a dead world closer to life.”

And that’s it for this week, folks. Stay gold.