The recent slowdown in the global games market has had a noticeable impact on industry events, with many leading conferences and trade shows experiencing reduced footfall or struggling to expand their show floors. It was therefore an encouraging sign for the industry to see Gamescom, the world’s largest games event, continue to buck the trend. This year’s event welcomed 357,000 visitors from 128 countries, an increase of 7 percent over 2024, with over 34,000 trade visitors, up 6 percent year-on-year. The number of exhibitors also grew by 7 percent.
Meanwhile, the developer-focused sister event, Devcom—soon to be rebranded as “Gamescom Dev”—also enjoyed record attendance, with 5,400 participants, signaling sustained interest in developer-oriented sessions despite broader market challenges. The contrast between Gamescom’s bustling floors and the struggles of other events over the past year underscores its position as a central meeting point for both trade and consumer audiences.
All major game companies, with the exception of PlayStation, participated in Gamescom 2025. As in previous years, China-based publishers maintained a particularly strong presence at Gamescom, not through traditional publisher branding, but through content-focused booths emphasizing live-service offerings. Many of these companies are still seeking to expand their footprint in Western markets, using Gamescom as a platform to showcase their IP to a broader audience.
While an event of this scale inevitably encompasses countless news stories and themes, a number of key topics stood out to the Omdia analyst team at this year’s show. These trends and developments provide a window into the broader dynamics shaping the global games industry in 2025 and beyond.
Nascent PC handhelds category plant roots for Xbox’s future
At the start of this decade, Microsoft set out an ambitious goal—to reach a billion gamers worldwide. The strategy relied on three pillars the rapid growth of Xbox Game Pass, cloud streaming to multiple devices, and strong adoption of the Xbox Series X/S consoles. Five years later, none of these have scaled as the company hoped. Game Pass growth has stalled and cloud gaming hasn’t resonated to a new audience, meanwhile, active installed base of Xbox consoles is estimated to be flatlining around 42m players by the end of 2025, according to Omdia’s Games Addressable Market Metrics Database.
Gamescom 2025 highlighted Microsoft’s evolving strategy to reach its goal. Aside from its continued commitment to bring games to competing consoles including the Switch 2, the company is now placing much greater emphasis on PC as a core engagement platform, and making much-needed investments in Windows to serve as an aggregator of PC games content.
This strategy is being led by the new full-screen experience for Windows—an Xbox-like interface on the PC—which is scheduled to debut alongside Microsoft’s first co-branded PC gaming handheld: The Asus ROG Xbox Ally. The new full screen experience solves a core challenge plaguing PC gaming handhelds to date, most notably Windows’ poor suitability for the form factor.
But it also pulls through content from additional storefronts such as Steam. This integration offers a clearer picture of Microsoft’s broader ambition: to leverage the massive PC gaming audience as a touchpoint for Xbox software and services. Omdia’s Addressable Market Metrics Database estimates Steam had 316 million yearly active users at the end of 2024, representing a huge audience for Microsoft to engage. Yet many questions remain unanswered, including the mismatch of Xbox content between console platforms and the PC. Furthermore, much needed functionality, such as advanced shader delivery and the Handheld Compatibility Program, are unlikely to bear fruit for years.
Nonetheless, Microsoft is playing a long game. The functionality revealed at Gamescom provides a solid starting point, and handheld PCs running Windows will soon get a much-overdue shot in the arm. Omdia estimates 2.3 million devices will be sold through to consumers in 2025—representing a small, but meaningful avenue to expand Xbox’s presence on PC.
Focus turns to practical applications of AI in game development
AI was not as immediately visible at Gamescom this year as at some recent trade shows, perhaps reflecting that the initial phase of the hype cycle may have peaked. Beneath the surface, it’s clear that more substantive applications of AI are coming to the fore. Companies such as AWS and Google are shifting from promoting AI in the abstract to working with customers on the details of implementation. A similar shift could be seen in the content program at Devcom with a higher proportion of AI-related talks focusing on specific applications.
There is also increasing clarity about where these early AI implementations can have most impact. While AI tools will almost certainly eventually have an enormous impact on the core creative workflows of game development, immediate gains have been slow to emerge due to a combination of challenges of integration and limitations of the underlying technology. On the other hand, business-focused use cases—especially in marketing, user acquisition, and LiveOps—are already showing increasing compelling results, suggesting that these are the areas where the impact of AI will be most immediately felt in the games industry.
Nintendo Switch 2 remains in a state of soft launch
Despite its record-breaking launch in June, Switch 2 saw a limited presence on the show floor, outside of Nintendo’s own booth. Omdia learned that a shortage of development hardware continues – even amongst long-time publishing partners – and has greatly hampered publishers’ ability to release Switch 2 content.
The wider event brought few surprises in terms of reveals for previously-unannounced Switch 2 games. This extends to major titles such as Microsoft’s Indiana Jones and the Great Circle, which was slated for a vague 2026 release window. In short, Omdia believes the wider publishing opportunity for Switch 2 will remain uncontestable to all third-party publishers until at least 2026.
For 2025, Nintendo’s strategy appears focused on building Switch 2’s installed base through a highly curated approach: monthly first-party releases, select second-party releases such as Hyrule Warriors: Age of Imprisonment, and a limited selection of hand-picked third-party content from its most trusted partners. This is in line with Omdia’s prediction that Nintendo would throttle the volume of new releases to Switch 2 software breathing room on a crowded Nintendo eShop. Nevertheless, for publishers, the wider content opportunity remains on the horizon.
Backend infrastructure providers face headwinds
The AI boom stands in contrast to a noticeably more gloomy mood in the market for traditional servers in backend infrastructure, particularly the smaller players hoping to break the dependance of the majority of game studios on hyperscale cloud and in-house tooling. There are undoubtedly success stories in the backend market, notably Heroic Labs which hosted a lavish celebration of its tenth anniversary at Gamescom. The desire to showcase the company’s longevity is itself telling, however, serving to highlight a challenge faced by all startups hoping to provide studios with critical infrastructure: convincing prospective customers that you will be around for the long haul. The resulting chicken-and-egg problem—as studios wait for their peers to adopt new solutions before committing themselves—has proven hard to solve.
Few question the fundamental thesis which has driven the proliferation of backend service providers: that developers are better off working with specialized partners to deliver best-in-class solutions than wasting resources each building duplicative systems. But with the market highly fragmented and momentum slow to develop, it seems inevitable that many backend service providers will fail over the next few years. The survivors may yet deliver on their early promise, but there was increasing acceptance from industry insiders at Gamescom that the prospects of rapid growth were receding and winning over developers would be a long-term project.
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Omdia and Game Developer are sibling organizations under Informa.
