Blizzard closed out Microsoft's 2026 fiscal year as the best-performing studio inside Xbox Game Studios, according to internal emails obtained and verified by Windows Central and reported by GamesIndustry.biz, VGC, and PC Gamer.
The message came from Blizzard president Johanna Faries, sent to staff ahead of BlizzCon 2026. "In FY26 Blizzard ended the year as the top-performing studio in Xbox's studios division, and this past year has marked our third highest fiscal for top line revenue in Blizzard's history," she wrote. Microsoft's fiscal year ran from July 1, 2025 to June 30, 2026.
Diablo and Overwatch Led the Charge
Faries pointed to two games as the drivers of the result. The second Diablo 4 expansion, Lord of Hatred, launched in April, and Overwatch posted what she called "its strongest quarter since 2022." According to the reported email, Overwatch has now grown for multiple consecutive years for the first time since its original release.
She also framed FY25 and FY26 as "our first back-to-back years of growth since FY17," a notable turnaround for a studio that has weathered plenty of ups and downs. Faries said the strong results would let Blizzard invest more in its games, its staff, and unspecified initiatives meant to "shape Blizzard's future."
A few caveats are worth keeping in mind. Microsoft does not break out studio-level revenue in its public financial disclosures, and neither the company nor Blizzard has confirmed the figures in the leaked emails. The reporting rests on the internal message alone.
A Bright Spot in a Rough Year for Xbox
Blizzard's reported growth stands out against the wider Xbox division, which had a difficult year. Per VGC, Xbox's Q4 FY2026 results showed content and services revenue down 10% year over year, with hardware revenue dropping 13%, and similar declines showing up across earlier quarters. Xbox CEO Asha Sharma has said publicly that the company expects to return to growth by the end of FY2027.
Blizzard has operated with some distance from the rest of Microsoft's games business since the Activision Blizzard acquisition closed in October 2023, following the UK Competition and Markets Authority investigation. It has also so far avoided the worst of Xbox's 3,200-job "reset," though PC Gamer notes a large share of those cuts have yet to land, and studios like Double Fine and ZeniMax have already been hit.
Blizzard is expected to lay out its upcoming slate at BlizzCon 2026, which GamesIndustry.biz reports runs from September 12 in Anaheim. It is the first BlizzCon since 2023. Rumors circulating ahead of the show include a StarCraft shooter and a follow-up to World of Warcraft Classic, though none of that is confirmed. Separately, VGC notes a Switch 2 version of Diablo 4 is reportedly due in September.
What This Means for Players
If you play Blizzard's live games, the takeaway is simple: the money is flowing back into Diablo 4 and Overwatch, and Faries is positioning BlizzCon 2026 as "a powerful springboard into a new era of momentum." That should mean more content and a clearer roadmap for both. Anyone eyeing new reveals will want to watch BlizzCon starting September 12, where a rumored StarCraft shooter and a WoW Classic follow-up could finally get official confirmation, and where the reported Switch 2 port of Diablo 4 may surface.