The global games industry converges at the expansive Gamescom trade fair in Cologne this week, with high hopes that upcoming blockbuster titles like “GTA VI” will rejuvenate a sector grappling with recent stagnation. The event kicks off on Tuesday with an opening night dedicated to showcasing major releases slated for the coming months, prominently featuring “Black Ops 7,” the latest addition to the enduring “Call of Duty” franchise.
Trade visitors will have the opportunity to explore the stands and forge connections on Wednesday, before the exhibition opens its doors to tens of thousands of enthusiastic gamers from Thursday to Sunday. Last year’s Gamescom attracted nearly 335,000 attendees to the Cologne exhibition center, where studios offered hands-on experiences with the latest releases through expansive stands equipped with consoles and PCs.
Nintendo and Microsoft Make Their Moves
In a notable return, Nintendo is back at Gamescom 2025 after its absence last year, buoyed by record-breaking launch sales for its Switch 2 console. Meanwhile, Microsoft’s Xbox division is set to unveil new portable hardware expected to hit the market by the year’s end. However, Sony, the Japanese giant behind the PlayStation, has opted out of this year’s event.
The mood among the approximately 1,500 exhibitors is mixed, as major publishers have recently returned to profitability, yet the industry continues to grapple with job cuts seen over the past two years. In early July, Microsoft announced plans to lay off around 9,000 employees, affecting game studios like “Candy Crush” developer King and leading to the cancellation of several games, including “Perfect Dark” and “Everwild.”
Industry Consolidation Amidst Competition
“The industry is consolidating quite a bit,” noted Rhys Elliott of specialist games data firm Alinea Analytics, reflecting on the boom during COVID-19 lockdowns that created a captive audience. According to the tracking site Games Industry Layoffs, around 30,000 workers have lost their jobs since early 2023, with over 4,000 affected this year alone.
Revenue in the global games market is projected to remain steady at just under $190 billion this year, according to data firm Newzoo.
While the number of players and hours spent gaming remain stable, an ever-expanding array of titles is vying for attention. With juggernauts like “Roblox” and “Fortnite” capturing the attention of hundreds of millions of monthly users, “everyone’s fighting for a smaller share of that pie,” said Circana expert Mat Piscatella.
Strategic Shifts and Cross-Platform Success
The quest for new audiences has prompted Microsoft’s Xbox, the world’s largest games publisher, to shift its strategy by increasingly offering its titles on competing console makers’ hardware. “They’ve had really great success on the PlayStation platform. Sony is making a bunch of money on that too,” Piscatella observed. “It’s a little bit of a win-win all the way around.”
Some PlayStation games are reciprocating the move, with “Helldivers 2” being the first to be made available on Xbox as well as the traditional PC port. This cross-platform strategy highlights the industry’s evolving landscape, where collaboration often trumps competition.
Balancing Budgets and Creativity
Securing sales is crucial in an era where developing high-spec “AAA” games can cost hundreds of millions of dollars, exposing studios to significant risk if their games do not perform as expected. However, recent breakout hits have demonstrated that lower-budget games can still captivate players with compelling gameplay, story, and art style. A prime example is the French turn-based battler “Clair Obscur: Expedition 33,” which has sold four million copies.
“There’s a realization you don’t need to spend masses of money to deliver a high-quality game that can appeal broadly, and so everyone is rushing towards that model,” said Christopher Dring, founder of industry website The Game Business. Yet, as Piscatella pointed out, “for every ‘Clair Obscur’ success story, there are 10 games that fail to find an audience at all.”
The competition remains fierce for smaller developers, who must fight hard for the funding necessary to bring their games to market. Despite the success of cult hits, analysts predict that mega-budget titles will continue to dominate. Rockstar Games’ upcoming “Grand Theft Auto VI” is anticipated to achieve the largest launch for any entertainment product in history, potentially revitalizing the industry.
As Gamescom 2025 unfolds, the industry stands at a crossroads, balancing economic challenges with creative innovation. The event promises to be a pivotal moment for gaming, offering a glimpse into the future of an ever-evolving industry.
