Xbox is formalizing its ambitions beyond game releases with the creation of XP, a new entertainment division intended to bring the company's major franchises to film, television, consumer products, live events, theme parks, and other experiences. The group will be led by Kayleen Walters, who joins after serving as president of Mojang and previously worked at Lucasfilm.
XP, a name that plays on the familiar gaming term "Experience Points," combines four areas that had previously existed as separate efforts: Xbox Pictures, Xbox Products, Xbox Partnerships, and Xbox Places. The strategy is not to turn Microsoft into a conventional in-house studio producing every show and movie itself. Instead, Xbox says it wants to identify and work with suitable partners across entertainment, licensing, physical attractions, and branded experiences.
The move arrives at a point when game adaptations have become a central part of the company's wider business. The success of A Minecraft Movie and the Fallout television series has shown the potential for Xbox-owned worlds to reach audiences that may never have picked up a controller. In turn, those adaptations can send established and new fans back toward the games, subscriptions, merchandise, and community events connected to them.
Four branches under one XP banner
XP's four named investment areas illustrate how broad Xbox wants this push to be. Xbox Pictures will cover film and television adaptations. This is the most immediately recognizable part of the announcement, especially given the recent momentum around game-to-screen projects. But the other three pillars are equally important to the company's stated goal of making franchises part of everyday entertainment culture.
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Xbox Products will focus on licensing and merchandise. Minecraft is already an enormous force in that space, with a merchandising operation that has become one of the world's top 20 globally. Toys, apparel, collectibles, books, home products, and other licensed goods provide a way for fans to engage with a game universe away from a console or PC. For Xbox, that also creates a more durable connection between big releases, seasonal updates, and a franchise's broader identity.
Xbox Partnerships is designed for sponsors and brand collaborations. Microsoft highlighted the Gears of War crossover with WWE as one example of the kind of cultural connection it intends to develop. Xbox's Ikea furniture range is another illustration: a branded partnership need not be confined to game software, and it can put recognizable Xbox properties in front of consumers who might not encounter them through a digital storefront.
Finally, Xbox Places encompasses major broadcasts, in-person events, theme parks, and other location-based attractions. A Minecraft theme park is scheduled to open next year, giving this branch an especially tangible early project. The category also includes the broadcasts and physical gatherings that turn announcements into communal moments for millions of viewers.
That event side has already produced considerable numbers. Blizzard's BlizzCon drew 35,000 attendees to Anaheim, California, while 12.5 million more watched from home. Minecraft Live has reached even further: the most recent broadcast, which unveiled Minecraft's first new dimension in 14 years, was watched by more than 144 million people. Those figures demonstrate why Xbox sees events not merely as promotional tools, but as products and fandom experiences in their own right.
Kayleen Walters moves from Mojang to head XP
Walters brings a background that fits the new organization's mixed mandate. Before leading Mojang, the Minecraft developer, she built experience at Lucasfilm. She also served as an executive producer on last year's A Minecraft Movie, making her familiar with the complications of translating a game property into a mass-market film while preserving the qualities that made its audience care in the first place.
"XP was created from a simple but powerful belief: the world's most beloved gaming franchises have an opportunity to reach people far beyond the boundaries of the game itself," Walters said.
Walters emphasized that players' relationships with franchises are no longer limited to playing. Fans may watch stories set in those worlds, wear related apparel, meet at events, collect physical products, or share a cultural moment around an adaptation. XP is intended to coordinate the teams responsible for making those touchpoints more visible and meaningful.
Xbox CEO Asha Sharma described XP as a structure that gives a formal home to the four investment areas. The aim is to let Xbox's properties carry greater significance than the hours people spend actively playing them, while working with entertainment and licensing industries without losing the underlying appeal of each franchise.
Adaptations are already on the way
The new division begins with a substantial pipeline already taking shape. Minecraft Squared, a sequel to A Minecraft Movie, is among the announced projects. Fallout Season 3 is also on the way following the series' strong performance for Prime Video. Elsewhere, a Call of Duty movie is being developed with Peter Berg and Taylor Sheridan attached, while Netflix is set to host an animated Diablo series.
There is potential for more in the future. Microsoft's agreement related to Hideo Kojima's Physint, described as a spiritual successor to Metal Gear Solid, includes film and television rights. That does not establish a specific adaptation or timetable, but it means the possibility is built into the arrangement.
The approach makes commercial sense in light of the uplift Microsoft has seen when an adaptation captures public attention. During Fallout Season 1, Fallout titles on Game Pass experienced a fivefold increase in hours played. Minecraft has enjoyed a similarly meaningful effect: as of April 30, 2026, its weekly active users had risen more than 75% year over year since the movie's release.
Those numbers do not mean every adaptation will automatically result in the same outcome. Each property has different audiences, gameplay styles, release cycles, and cultural visibility. Still, they give Xbox a clear incentive to treat screen projects as connected parts of a larger franchise ecosystem rather than isolated licensing deals.
A second attempt at a familiar idea
XP is not the first occasion on which Microsoft has sought to build a dedicated Xbox entertainment operation. During the Xbox 360 era in 2012, the company announced Xbox Entertainment Studios, an initiative aimed at producing television programming that would be delivered directly through Xbox consoles.
That earlier studio considered projects based on Gears of War, Fable, Forza, and State of Decay. It was also associated with an early version of the Halo television project, announced at E3 with Steven Spielberg set to executive produce. Plans reached beyond established game brands as well, including an unscripted street-soccer drama called Every Street United.
Xbox Entertainment Studios survived only two years. Its closure came after the Xbox One's original "all in one" positioning struggled to connect with players following the console's 2013 reveal. The history provides useful context for XP: Microsoft has attempted a major entertainment expansion before, but today's market is very different. Game adaptations are now much more proven as a category, Xbox has successful examples of its own, and its plan is explicitly centered on partnerships rather than presenting itself primarily as a self-contained production studio.
Mojang receives new leadership
Walters' move to XP also creates a leadership change at Mojang. Maria Angelidou-Smith is joining Xbox as Mojang's CEO. She spent nearly a decade at Meta working on Facebook Groups, then held roles at Personio and Reddit, where she served as chief product officer.
Sharma pointed to Angelidou-Smith's experience building products used by billions of people and guiding product and engineering teams through periods of major growth and change. Her immediate priority will be learning from the Mojang teams and communities that have made Minecraft endure.
Minecraft remains one of the clearest reasons for Xbox's expanded strategy. It is the best-selling video game of all time, with more than 425 million copies sold, and its audience spans PC, console, mobile, handheld, and family-focused play spaces. That combination of scale, accessibility, recognizable iconography, and merchandising power makes it an ideal test case for what XP wants to accomplish.
The announcement also lands amid Sharma's broader Xbox "Reset," which has resulted in nearly 2,000 job cuts across the gaming business so far this financial year. That context makes the company's focus on its largest and most adaptable properties especially notable. XP represents a bid to extract more value from those worlds across several markets at once, while also giving fans more ways to encounter them.
For players, XP will ultimately be judged less by its organizational chart than by the projects it produces. Strong adaptations, thoughtful collaborations, and events that respect their communities could extend Xbox franchises in exciting directions. If the division succeeds, the next major Xbox experience may not start with a download button at all.
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