When I was a kid in the late 90s, collecting Pokémon cards was a fun hobby. I’d buy packs, hoping to get the rarest “shinies,” or holographic cards. We’d trade with friends and even go to meet-ups to trade cards trying to “catch ’em all” —a catchphrase that defined the franchise that had gone from Nintendo Game Boy to an anime TV show.

When I started collecting again two years ago, things had changed. I’ve stood in line with 100 people in a parking lot outside a toy store for the latest restock of cards. I’ve seen four men huddled around their car talking about how much they could make by selling the trunk of cards they bought during a morning hitting different stores.

New cards can sell out in minutes. People coordinate on X and Discord to know where to go.

There are similar scenes in the U.S. Videos have circulated on social media of people stampeding over each other to get their hands on card packs. There have even been reports of smash-and-grab thefts of stores that stock cards. Prized cards resell at multiples of what they retail for. The rarest can sell for millions of dollars.

It’s a stark contrast from when I could walk into any store and buy however many I wanted.

From 2004 to 2020, Pokémon card prices rose 282%, according to an index compiled by Collectors, which owns card grading agency Professional Sports Authenticator (PSA). Since 2020, prices have risen by an incredible 1,350%, per the index.

Prices have surged and even outperformed traditional asset classes, attracting the attention of people looking to make a quick buck and ultra-high net worth individuals seeking investment assets to protect or grow their wealth.

People who have made money from cryptocurrency are piling into the market, market watchers told CNBC, as prices reach unprecedented levels.

Microsoft’s Xbox has had a tumultuous year.

A slew of layoffs, price hikes and studio closures have led many to declare — not for the first time — that the Xbox is dead.

Laura Fryer, former executive producer at Microsoft Game Studios, said in June that the company seems to have “no desire or literally can’t ship hardware anymore.”

Former Microsoft executive and ex-Blizzard Entertainment president Mike Ybarra slammed Xbox’s “confusing” strategy in a now-deleted X post in October, saying the company is potentially heading for a “death by a thousand needles.”

The company’s overall gaming revenue decreased 2% year-over-year, with a 29% dip in Xbox hardware sales, according to Microsoft’s first-quarter earnings for fiscal 2026.

The broader console industry has been in a major slump, with hardware spending down 27% year-over-year in November, which is typically a busy shopping month, according to a recent report from research firm Circana.

It was the worst November in two decades, IGN reported, citing Circana data.

Combined Switch and Switch 2 unit sales were down more than 10% during the month and PS5 sales were down more than 40%, IGN said. But the Xbox Series hardware took the biggest beating, with a dramatic 70% drop in sales.

In console sales, Xbox can barely see the leaders this year.

Nintendo‘s Switch 2 has sold 10.36 million units since its debut in June, the company said in its latest earnings report. Sony‘s PlayStation 5 had 9.2 million units sold in 2025, according to its most recent financial results.

Microsoft’s Xbox Series S and Series X, at 1.7 million units, couldn’t outsell the original Nintendo Switch, which launched in 2017 and has sold 3.4 million units so far this year, data from game sales tracking site VGChartz estimated.

Microsoft declined to comment on Xbox sales or numbers.

The company stopped reporting console unit shipments in 2015 as the gap between Xbox and PlayStation widened.

The Series S, Series X and PS5 all originally released in 2020, with some updates being released since then.

In November, Valve made a splash with its next-generation Steam Machine, which is set to launch next year.

The reveal of its console-PC hybrid generated buzz across the gaming landscape, with The Verge declaring that “Valve just built the Xbox that Microsoft is dreaming of.”

The mini cube will be able to run Windows PC games through Valve’s own Linux-based SteamOS as a television console or as a gaming computer. Gamers will have access to Steam’s extensive library of thousands of games.

But Microsoft doesn’t seem too worried about falling behind.

“We’re not in the business of out-consoling Sony or out-consoling Nintendo. There isn’t really a great solution or win for us,” Microsoft Gaming CEO Phil Spencer said in a 2023 podcast.

In congratulating Valve on the release, the Xbox boss gave a nod to the movement to expand gaming access “across PC, console and handheld devices.”

As Sony and Nintendo have firmly established themselves as hardware companies, Microsoft is pushing toward Bill Gates’ original vision of an all-encompassing entertainment hub in the living room.

“Ultimately, the addressable market is anybody who wants to play games, and Microsoft wants to serve that market,” Wedbush analyst Michael Pachter told CNBC.

Microsoft CEO Satya Nadella said in a recent interview with the TBPN podcast that the company’s gaming business model will look to be “everywhere in every platform,” from consoles to TV to mobile.

His comments also hinted that the next Xbox may function more like a PC.

“It’s kind of funny people think about the console and PC as two different things,” Nadella said. “We built a console because we wanted to build a better PC, which could then perform for gaming. So I kind of want to revisit some of that conventional wisdom.”

Xbox President Sarah Bond echoed the idea, saying in a recent interview with Mashable that the company’s next-generation console will have “some of the thinking” seen in the Xbox’s new handhelds, which were built by hardware manufacturer Asus in partnership with Microsoft.

Launched in October, those devices support cross-platform gaming and can run PC games bought from Epic Games, CD Projekt and Valve stores.

Xbox has already incorporated that approach into the latest Backbone Pro, which rolled out in November. 

Designed in partnership with Backbone Labs, the portable gaming controller offers access to cloud gaming on mobile, PC, smart TV and other streaming devices.

So what will Microsoft’s new-gen console look like?

Little is known about where the company is at in its development. 

A source familiar with Xbox strategy told CNBC that the company is looking at creating an open system that enables players to jump between console, PC and cloud gaming — and any form of entertainment beyond gaming.

In a 2019 interview with The Verge, Spencer said that he was not concerned with focusing on console sales as much as making games accessible.

“I do think as we look at the next decade of gaming, as we think about reaching the over 2 billion people on the planet who play games, many of those people won’t be buying consoles and gaming PCs,” Spencer said.

Xbox Game Pass subscription service, which gives subscribers access to games from a variety of publishers, is a clear example of this strategy.

Microsoft has been steadily expanding its title offerings on the service.

The platform’s most basic tier, Game Pass Essential (previously Game Pass Core), which costs $9.99 and launched in 2023 with 36 games, now offers over 50 titles.

Ultimate tier members have access to over 500 titles.

The growth in cloud gaming has been blistering.

Xbox reported a record 34 million Game Pass subscribers in 2024 and a total Game Pass revenue of almost $5 billion over the last fiscal year. 

Xbox said in a November blog post that the number of cloud gaming hours from Game Pass subscribers was up 45% compared to the same time last year. The Microsoft subsidiary also said console players are “spending 45% more time cloud streaming on console and 24% more on other devices.”

In announcing the benchmark, the platform added that Xbox Cloud Gaming is now in 30 countries with the expansion into India, which it called “the fastest-growing gaming market in the world,” home to more than 500 million gamers this year.

Although Microsoft faced heavy criticism from subscribers after increasing the cost of its Ultimate tier by 50% from $19.99 to $29.99 in October, the company is reportedly testing an ad-supported version of Xbox Cloud Gaming.

Omdia senior principal analyst George Jijiashvili told CNBC that a free Game Pass tier would likely act as a user-acquisition tool, especially for gamers who have not invested in consoles yet.

However, due to the high costs associated with cloud gaming, an ad-supported tier would likely not be able to actually drive a meaningful amount of revenue, he said.

Cloud gaming is inherently difficult to scale since it needs to balance computing power and operating costs with user affordability.

“With console-grade cloud gaming, you need to essentially run every single instance of the game in a server,” Jijiashvili said. “You need a dedicated hardware for every single person that’s streaming the game, meaning it just doesn’t scale.”

Despite gaming’s scaling limitations, Microsoft seems committed to doing what it has done with the rest of its products — moving it to the cloud. 

“They’ve evolved into a primarily cloud services company,” Pachter said. “So everything they’ve done since they started acquiring studios at Xbox has been toward the connected experience in the home to view entertainment.”

Bond recently said in an interview with Mashable that the idea of exclusive games is “antiquated” as the company has leaned into cross-platform gaming.

Microsoft announced in October that the upcoming “Halo” game will be available on Sony’s PlayStation 5, marking the first time the major franchise has become accessible on a competing console.

In 2024, Xbox opened four formerly exclusive games to other consoles.

Spencer said at the time that the move did not indicate a change in Xbox’s exclusive strategy, but the company has since continued to bring several former exclusives to rival platforms.

In a January interview, Spencer said that the company won’t “put walls up” where users can engage with Xbox games.

“What we’ve learned is put the games first, make sure the games can be as great as they can,” he said. “We love the experience on our own hardware, on our own platform, but our games will show up in more and more places.”

In May, the company also shut down several studios under game publisher Bethesda, including “Redfall” maker Arkane Austin and “Mighty Doom” developer Alpha Dog Games.

The gaming unit was hit again when company-wide layoffs in July led to Microsoft shelving “Perfect Dark” and “Everwild,” games that have reportedly been in development for at least seven years, as well as multiple unannounced projects.

Some have attributed the cost-cutting measures to mounting pressure to hit lofty profit goals.

The company reportedly asked its gaming division in 2023 to target profit margins of 30%, according to Bloomberg, which cited people familiar with the matter.

The goal was a significant jump from the 12% profit margin Xbox reached in 2022, as revealed in court documents, and well above the average video-game industry standard of 17% to 22%, analysts told Bloomberg.

Microsoft told CNBC that while the company does set ambitious goals, the reported 30% profit margin target was incorrect.

Microsoft has raised prices on its aging lineup of flagship consoles twice over the past year. Nintendo and Sony also announced price hikes for their respective consoles in August. 

The PS5 currently starts at $549.99, and the original Nintendo Switch and Nintendo Switch 2 cost $399.99 and $499.99, respectively.

Xbox’s new ROG Xbox Ally and ROG Xbox Ally X were priced at $599.99 and a staggering $999.99, respectively.

With a growing number of consoles and handhelds in the market, competition is fierce for a dedicated group of customers that will always be interested in owning hardware.

But Xbox is betting that cloud and cross-platform gaming are the future.

For a decade, claims have been made about the death of the Xbox, and what comes next could fully spell the end, or bring a metamorphosis.

Take-Two Interactive CEO Strauss Zelnick said on Monday that although gaming consoles are not going away, the industry is moving toward PCs in the next decade.

“I think it’s moving towards PC and business is moving towards open rather than closed,” Zelnick told CNBC’s “Squawk Box.” “But if you define console as the property, not the system, then the notion of a very rich game that you engage in for many hours that you play on a big screen — that’s never going away.”

Zelnick said the current split between console and mobile is about even in the market, but mobile is growing more rapidly than consoles.

Although gaming giants like Sony’s PlayStation and Nintendo have remained focused on traditional consoles to major success, rivals like Microsoft’s Xbox have hinted at more PC-based gaming for the next generation of hardware.

Gaming company Valve garnered significant buzz last week after announcing its new Steam Machine, a console-PC hybrid that can run PC games on a television or as a normal gaming computer.

Artificial intelligence is set to have a huge impact on the gaming industry and its billions of players, according to Min-Liang Tan, the billionaire CEO and co-founder of gaming firm Razer.

From the ways in which games are developed to hacks for completing levels, Tan said the technology’s ramifications across the sector can’t be overstated.

“For us at Razer, the way we see it is that AI is going to completely disrupt everything, or change everything in gaming,” Tan told CNBC’s “Beyond the Valley” podcast.

Gaming plays a significant role in the creative sector, with 3.6 billion players around the world and annual revenue of nearly $189 billion, according to research company Newzoo, which tracks data across mobile, console and PC games.

“Game developers will now be able to use AI tools, and then you’ve got game publishers that will now distribute, market new games with AI tools … For gamers, the AI tools will be able to change things, in terms of the way they play,” Tan told CNBC’s Arjun Kharpal at Singapore’s SWITCH conference.

Razer, known for its gaming gear like mice, headsets and keyboards, has developed Game Co-AI, a tool that uses computer vision to “watch” how a gamer plays and provides tips on solving quests or defeating enemies. The tool will also use data such as public APIs, and a beta version of Game Co-AI will be available “later in 2025,” according to Razer’s website.

The potential use of AI in esports — or competitive gaming — has sparked debate, however.

“We will not have AI running, I think, during a game itself, but what about at the point of time of training?” Tan said. There is an appetite among some esports players to use AI to help coach future stars, Tan said. “There’s a lot of excitement in respect of this. The opportunities are limitless.”

Along with helping players, AI will also be able to detect and fix bugs when games are developed, according to Tan.

Traditionally, game testing involved “a whole bunch of people sitting in a room,” playing games and identifying bugs one by one, Tan said, in a process known as quality assurance or QA. Razer is developing an AI QA Companion, which can find and log bugs — and will soon also be able to suggest bug fixes, he added.

“[QA] is about 20% to 30% of the [development] costs, it takes up about 30% of the time,” Tan said, adding that the new tool will automate the QA process, making human testers more effective and productive.

Nintendo more than doubled revenue in its fiscal first quarter, as the company logged bumper sales of its Switch 2 console in the first month of release.

Sales of Nintendo’s Switch 2 now total 5.82 million units, the company said in an update on its investor relations website Friday.

Here’s how Nintendo did in the quarter ending on June 30 versus LSEG estimates:

• Revenue: 572.3 billion Japanese yen ($3.8 billion), up 132% year-over-year and above the 474.84 billion yen expected.
• Operating profit: 56.9 billion yen, versus 53.46 billion yen expected.

Sales from Nintendo’s dedicated video game platform business grew 142.5% year-on-year to 555.5 billion yen, driven primarily by a higher price point for the Switch 2, compared with that of its predecessor, according to the company.

Sales within Nintendo’s intellectual property-related business — which includes movies and entertainment based on the company’s original games — meanwhile declined 4.4% due to a decrease in revenue from “The Super Mario Bros. Movie.”

Despite the bumper quarterly performance, Nintendo maintained its revenue and operating profit guidance for the fiscal year ending March 2026 unchanged at 1.9 trillion yen and 320 billion yen, respectively.

Nintendo shares have rallied roughly 40% so far this year on the back of excitement about the tech giant’s new Switch 2 hybrid console.

The device, which launched on June 5, sold more than 3.5 million units in its first four days and Nintendo expects it will hit 15 million unit sales in the current fiscal year.

Nintendo on Friday kept its annual sales forecast for the Switch 2 unchanged at 15 million units. Analysts, however, say this target is conservative, and that the company will likely exceed that number.

One factor that could dent Nintendo’s financial prospects is an expected hit from U.S. tariffs. However, analysts at Morningstar believe Nintendo will weather the storm by increasing its overall gaming audience.”

“Although Nintendo’s profitability is expected to decline in the short term due to higher tariff rates, the company will recoup the losses in the long term by selling more games to a larger user base,” said Kazunori Ito, director of equity research at Morningstar.

For its part, Nintendo said Friday that, “While there have been changes in the market environment since we announced our initial forecast for the fiscal year, such as the U.S. tariff measures, at this time there is no significant impact on our earnings forecast for this fiscal year.”