The 2026 XBOX Games Showcase was undoubtedly full of exciting game reveals from AAA studios and independent teams alike, but there was one reveal that I can’t stop thinking about. As soon as the big purple text and strange bird-like creatures appeared on the screen, I noticed the art style. Everyone’s favorite little purple dragon is back to face a new enemy, albeit with a new mature design that showcases some of the new gameplay mechanics.
Bob’s Toys revealed Spyro: The Realm Beyond in a brilliant cinematic trailer, complete with a tease of our hero’s newest ability – gliding bye, flying. Spyro can be seen flying in the air with his new ability: flying freely on the arches of the bridge and collecting orbs in the sky of a beautiful world full of colors, where the danger of a great dark and mysterious evil lurks above the clouds.
Watch it open
The reveal of Spyro: A Kingdom Beyond It was a success. The cinematic trailer on the Spyro The Dragon YouTube channel has amassed over 16 million views in just two weeks. Add another million when you add up the viewing figures for all XBOX, Nintendo, and PlayStation channels.
But a successful revival of Spyro almost never happened. Bob’s Toys had to return to its independent roots after being targeted by Activision to give his beloved purple dragon his big boy wings.
The way that Bob’s Toys has developed – to avoid closure and exit to become an independent studio that continues to work in partnership with Activision and XBOX to publish its next game – could be a solution that could save studios like Ninja Theory and Compulsion Games, which are rumored to be following the decision under the “reset” of the new CEO of XBOX Asha Sharma.
A remarkable history that led to a strong program
Few game studios make it to see their 35th year. With the chaos of the gaming industry today, that elite club seems even more difficult. But Toys for Bob, founded in 1989 and a partnership between founders Paul Reiche III and Fred Ford until the couple merged the studio in 2002, has somehow managed to not see the mark of only 35 years – it has passed that milestone and continues to go in droves, creating exciting and meaningful digital worlds for devoted fans.
However, the story of Bob’s toys is one of durability. In 1990, the studio changed the landscape of science fiction games with the release of Star Control, followed by the 1992 sequel Star Control II with Accolade, Inc. and Crystal Dynamics as its publisher. Bob’s Toys continued to work with Crystal Dynamics until the early 2000s, when they faced layoffs following the release of Disney’s 102 Dalmatians: Puppies to the Rescue.
We were running away from the kinds of games we like to play and are famous for.
Paul Yan, Toys for Bob Studio Head
The studio found a new publisher in Activision and was fully acquired by the publisher in 2005. Activision then merged Bob’s Toys with Vivendi Games, which held the rights The Spyro IP at the time, set the studio to launch the Skylanders series and pioneered the toys-to-life game genre. “We had a good, successful relationship then,” Bob’s Toys studio head Paul Yan said recently IGN interview. Bob and Spyro’s time toys didn’t end there, as he then released the Spyro Reignited Trilogy in 2018.
After the incredibly successful launch of Call of Duty: Warzone in March 2020, however, things changed at the studio as Activision began to allocate all of its studio teams to the free-to-play combat game. Bob’s Toys took its place as part of the dozen-plus studio machine that fueled Call of Duty in addition to providing support for Overwatch 2 and other Activision properties.
Check out an early preview of how #Spyro could evolve to face new challenges in #ARrealmBeyond pic.twitter.com/jz2ttxzgttJune 16, 2026
“Bob’s toys stepped up to support those programs, and those teams, and those games. We are very proud of the work we did, but deep down, we knew it wasn’t right. We were moving away from the kinds of games that we like to do and are famous for doing,” Yan said.
Activision was then acquired by Microsoft in 2022. Despite the statements of the then Microsoft Gaming CEO Phil Spencer about the potential for studios to revive past IPs, Toys for Bob still found its studio offices closed amid massive layoffs that affected 1900 jobs across Microsoft’s workforce in January of 2024. Just four months later, Toys was successfully re-released.
How to save game development studio Toys for Bob way
Bob’s toys were never seen before. Buy back its independence. Take back creative, financial, and organizational control. And maintain its established team. For the plan to succeed, it depended on Spyro’s past success. The team has commissioned a new Spyro title, published by Activision and XBOX with a day one release strategy XBOX Game Pass, to protect its future. Two years after going independent, the Spyro: A Realm Beyond trailer that appeared during the XBOX Showcase feels like a step in the right direction with a strong plan to pay for independence.
However, when things change a lot, they stay the same. XBOX has a new CEO with fresh eyes on the company’s future, but soaring hardware prices and ballooning development costs are taking the world by storm. We are told that a ‘hard reset’ is imminent. Microsoft-owned studios such as Ninja Theory and Compulsion Games are the new sacrificial lambs sitting on the precipice, despite Senua’s strong showing at the XBOX 2026 show and South of the Night’s ongoing awards night.
Studio closures are a scourge in the gaming industry. Studios are often formed from groups that come together to bring life to a creative idea, and then those studios are rounded up by publishers who promise financial security. Then, when the tides of the changing industry turn, the studio closes, and the creative talent that was being developed finds itself split between other studios, where the cycle begins again. That’s without considering the talent that simply leaves the gaming industry altogether.
Spyro: The Realm Beyond was more than just a game announcement. It felt like a winning opportunity for independent game development and a survival plan for how studios can keep things together even in the face of closure.
With any luck, a solid plan to let Bob’s Toys become an indie studio with creative control could serve as a roadmap for studios like Ninja Theory and Compulsion Games if the rumors of their closure turn out to be true. If there’s anything the gaming industry could use right now, it’s strong freelance revenue programs.
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