Gears of War: E-Day reportedly cost $500 million to make, while it sold just over 400,000 copies.
The Coalition action game launched on Xbox Series X, S, and PC only, after Microsoft took the console-exclusive route following Asha Sharma’s arrival as Xbox CEO. As a Microsoft Studios game, E-Day also launched day one on the subscription service, Xbox Game Pass.
This week, The Verge reported that E-Day had sold over 400,000 copies on console and PC. That’s a mediocre sales figure for any triple-A video game of Gears of War’s scale and prestige, but it could be an even worse business situation for Microsoft and The Coalition, given the extraordinary budget for E-Day.
Bloomberg reporter Jason Schreier endorsed recent E-Day budget reports in a video expanding on the cancellation of Mass Effect 5 and the shutdown of BioWare.
“We just saw Gears of War: E-Day cost Xbox $500 million. And that’s a real number. It’s real,” Schreier said. “That’s what we’re looking at here. That’s what it costs to make (AAA) games, especially in North America these days. And that’s pushing these game companies to make layoffs, cut costs, move development outside of North America in many cases, and just focus on the biggest franchises that pose the least risk possible.”
The $500 million figure for E-Day was first reported by Kotaku, which said it was before marketing costs. IGN requested comment from Microsoft at the time, but it has not yet responded. This makes E-Day one of the most expensive video games ever made, costing double the price of some of its competitors. Bungie’s recently released extraction shooter Marathon reportedly had a budget of over $250 millionFor example. Concord’s initial development contract was worth about $200 million, according to a report from Kotaku. In 2023, documents submitted as part of Xbox Federal Trade Commission filing accidentally revealed that The Last of Us: Part II and Horizon Forbidden West each cost over $200 million to develop. Last year, Astronomical development budgets for Call of Duty games revealed for the first time after a court document confirmed that Activision injected $700 million into Black Ops Cold War alone, even if it was for the shooter’s entire lifespan.
On October 13, a week after E-Day’s official release date, Rhys Elliott of Alinea Analytics estimated that the game had generated $42.1 million in revenue, having sold 311,000 copies on Steam and Xbox. He also highlighted the increase in Game Pass subscriptions that appears to have been a result of the release of E-Day, while lamenting the lack of a PS5 version, which could have generated an increase in revenue.
One question Microsoft may have regarding Gears is the impact on Game Pass. Did this have a big enough impact on the subscription service to offset disappointing revenue? With a budget of around $500 million, can Gears of War: E-Day ever be considered profitable?
Discussing Xbox’s current financial woes this week, Sharma pointed out that Minecraft and World of Warcraft Forever had set records, and that Call of Duty: Modern Warfare 4 had received critical acclaim. No mention was made of Gears of War: E-Day.
What does all this mean for the future of the franchise? Earlier this month, The Coalition boss responded to reports that studio staff fear losing their jobs amid ongoing cuts at Xbox, promising that the next Gears game wouldn’t take as long to make.
Eurogamer had reported internal concerns about layoffs that could affect the Coalition following the release of E-Day. “The mood is definitely ‘let’s not celebrate the game until three months after launch, just in case’, which is very unusual,” a source told the site. “We’re just expecting the next wave (of layoffs), or a reorganization under Activision or something later this year,” said another.
Xbox CEO Asha Sharma’s “reset” of Microsoft’s gaming business has already resulted in the elimination of nearly 2,000 positions this fiscal year, with more to come. A number of studios have left the company or are in the process of closing their doors. Microsoft also reorganized its studios, bringing together Halo and Sea of Thieves developer Rare under Call of Duty developer Activision, and Grounded developer Obsidian under Fallout developer Bethesda.
Coalition studio head Mike Crump recently told BBC This E-Day success goes beyond sales, saying: “We measure things like: Are we showcasing the platform? Are we pushing the hardware to its limits? Are we showing what Xbox is capable of? …Our goal is fundamentally to be the best looking game on Xbox and to really show the industry what’s possible with our hardware.”
Wesley is the editor-in-chief of IGN. Find him on Twitter at @wyp100. You can reach Wesley at wesley_yinpoole@ign.com or confidentially at wyp100@proton.me.
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