By Jacob Miller | Oct 13, 2025
Also in early October 2025, and circulating on social media, there were reports of Walmart and Target following suit. In several posts by users reportedly working at these retailers, their stores were either starting to cut Xbox sections or eliminating them altogether.Microsoft responded to the rumors by addressing the retailer situation and reported on October 12 that Walmart and Target were “committed partners.” Their statement made it seem that if these retailers were reducing Xbox products, it was their decision and unrelated that there had been any cut in retail partnerships in North America.
Is it time to worry about retail changes in the direction of Xbox Hardware?
This retailer's behavior regarding Xbox product attention dropped to remedial levels in late September 2025, when Costco pulled Xbox listings from its site and continued its console clearance deals upon visiting the stores. Costco called this decision a “business decision” and went on to say they had no plans to restock an Xbox console in any of the states.
After Costco's decision, Sam's Club stores were also reporting price reductions, clearance deals, and reduced Xbox inventory altogether.
At the start of October, and in one more account to the rumor, Target users CodeE1985 and Jawwad127 again posted that their Target stores had begun removing Xbox, followed on by scuba16365, another Target store employee users who made a similar post on social media.
Another individual, Spacefox_85, apparently a Walmart employee, posted that their store had plans to remove its Xbox display during a store renovation.
While Walmart and Target have not made any formal announcement yet that these changes are system-wide, the timing of the nominal changes lays the groundwork for speculation that retailers are perhaps bracing for a change in demand or inventory level.
Taken together, these describe some uncertainty surrounding Xbox's retail footprint. While Microsoft still makes and supports its gaming consoles, a shrinkage in store footprint may be a signal of a major retailer's reconsideration of the value of stocking a physical Xbox system, given falling sales and a growing demand for digital distribution.
Microsoft Reaffirms Commitment to Xbox Hardware
Despite growing uncertainty, Microsoft has continued to say that there are no plans to exit the Xbox hardware business. On October 5, a statement was again issued to reassure people that Microsoft continues to "actively invest" in first-party gaming hardware, and that Xbox continues to be a relevant part of Microsoft's long-term gaming strategy.
The statement from the company serves primarily to ease the minds of fans and investors that a next-generation Xbox console is still in the making. Most industry insiders are predicting Microsoft to launch its next gaming hardware line towards the end of 2027 when the 10th generation of consoles are expected to arrive.
But the recent economic woes add to uncertainty about how future consoles will evolve.
According to reports, Xbox hardware sales fell sharply during 2025 due to stagnant brand growth, tariffs, and rising manufacturing costs. The October 3nd price increase from import tariffs made the 2TB Xbox Series X $800 USD, a significant price jump that keeps that console less competitive with console platforming from Sony or Nintendo.
These pressures may lead Microsoft to rethink its focus for its next generation of gaming devices. Analysts theorize that future console designs by Microsoft could operate more closely to a high-end computer, sharing software frameworks and development tools. Game studios would be able to launch PC and Xbox versions without spending excessive reconfiguration and development costs, while still allowing all types of games to play together seamlessly.
As the Xbox brand faces downward pressure though an increasing number of product removals, immense speculation, and the belief that the Xbox console is nearing a sunset of good and bad, the company publicly states it is focused on delivering support for the consumer and platform.
The assurance provided on October 12 that Walmart and Target are still official retail partners and that the gaming space adjustments are merely stores adjusting their stock levels does just that.
Despite the growing pattern of markdowns and product removals, there are concerns on whether consumer demand is being met and if the changes will continue impacting visibility and store demand. There is no doubt that digital game sales continue to be a driving force and that cloud gaming is only growing into a larger set of options, regardless of how physical sales may impact retailers on traditional console options.
As this type of contemporary type of overall growth continues and expands into new or existing retail sources for consoles, a likelihood remains that traditional retailers may transition or leverage the device gaming space for health reasons.
Whatever the company's challenges, Xbox remains one of the most pivotal parts of Microsoft's entertainment work. Microsoft appears to be somewhere in the middle of IT, outsourcing hardware development, cloud gaming services, and gaming services, PC, and devices altogether.
If Microsoft can successfully build the upcoming Xbox generation as expected around 2027 and the next gaming experience platforming they perceive necessary to re-engage interest in their gaming ecosystem, then Xbox is not near possible completion.
For the time being, while retail adjustments happen as they do, there is nothing to suggest Microsoft is not making further investment in development focus areas, both to console development for traditional gaming and its digital gaming delivery services. Stay tuned to the evolution of the gaming experience via one of the few or perhaps best-known names in the gaming world.
