Yesterday, something inconceivable happened within the video games industry. PlayStation, Kojima Productions, and XBOX announced major change concerning one of Hideo Kojima’s most anticipated titles, PHYSINT. Originally, PlayStation was announced as the publisher for the game. However, things have changed. PlayStation announced it was walking away from its collaboration with Hideo Kojima, Kojima Productions on the development of PHYSINT, with XBOX revealed as the new partner. Now, a new Bloomberg report shares more details as to why PlayStation backed out.
This week, PlayStation announced that it had pulled out of publishing Hideo Kojima’s next game, Physint. But the company didn’t give a reason. So I made some calls.
Here’s why PlayStation bailed and why Xbox snapped Kojima right up: www.bloomberg.com/news/article…
— Jason Schreier (@jasonschreier.bsky.social) September 11, 2026 at 6:35 AM
Bloomberg’s Jason Schreier reports that PlayStation pulling out of the collaboration was due to three main factors: budget, potential profitability, and exclusivity, according to people familar with the project.
The people say a major factor was due to the commercial performance of Kojima Productions’ Death Stranding series. Both games, reportedly, did not meet PlayStation’s revenue expectations and targets. Another factor is the issue of missed deadlines and how the game was on track to be over budget, despite being years away from release. PlayStation was also reluctant to invest hundreds of millions of dollars in a game that wouldn’t be exclusive to PlayStation.
Earlier this year, it was revealed and later confirmed that PlayStation would stop its multiplatform push that they have focused on during this generation and would go back to making its first-party studios exclusive to only being available to play on its platform.
Death Stranding and Death Stranding 2 were “timed” exclusives on PlayStation but eventually went to other platforms. Kojima Productions has retained ownership of the franchises.
Another reason the relationship between PlayStation and Kojima has changed is due to the fact that many of the PlayStation executives who had close relationships with Kojima have left the company.
I mention this in the story but also worth highlighting: Business in Japan is all about relationships, and some of the PlayStation executives who have worked closest with Kojima over the last few decades are no longer at the company
— Jason Schreier (@jasonschreier.bsky.social) September 11, 2026 at 6:47 AM
XBOX saw PHYSINT as a good investment opportunity as they have been having their issues like PlayStation in this current video game climate. One key factor is the PC platform. Unlike PlayStation, PC is a factor and focus for Microsoft and XBOX. XBOX releases all of its games on both PC and XBOX and plans to do that with PHYSINT.
The deal also includes film and television rights for PHYSINT and the second title from Kojima Productions, OD, an experimental horror game. New XBOX CEO Asha Sharma said that expanding XBOX’s properties to television and movies is a significant part of her strategy.
Betting on Kojima-san is an easy call,” said an Xbox spokesperson. “We believe in his team’s ability to build AAA games with groundbreaking, new IP and we believe in OD, Physint, and our growing partnership.”