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The story
Hideo Kojima revealed on X that in mid-June this year, Sony (SIE) notified him it was “canceling the project” for PHYSINT, which was then in development. After spending three months searching for a new partner, he announced that development would continue with Xbox on board. Sony, for its part, issued a statement saying it had “made the decision to step back from the PHYSINT collaboration.” On the thread, opinions split over how well Death Stranding 2 actually sold, given its predecessor’s sales figures and production budget, with posters also linking the split to Sony’s recent shift away from its heavy focus on big-budget blockbuster titles.
What people said
@Kojima_Hideo
As just announced in an official release from Kojima Productions, in mid-June this year we suddenly received notice from SIE that they were "canceling the PHYSINT project," which was then in development. PHYSINT is an important project both to me and to Kojima Productions, so over these past three months I've been searching relentlessly for a "new partner" to make sure it could continue no matter what. After consulting with people across many different fields and pushing negotiations forward, we've decided to team up again with XBOX as a partner who shares our "vision for the future." PHYSINT, our next-generation "espionage action" title, is still in development, so please don't worry.
PlayStation
@PlayStation
Translated from English
An update from PlayStation Studios: After careful consideration, we've made the difficult decision to step back from our collaboration with Kojima Productions on PHYSINT. We continue to hold great respect for Hideo Kojima's vision for the game.
Wait, why though?! ("nande yanen" — Kansai-dialect exasperation, like "come on, seriously?")
Even the first one only padded its numbers by going free on Epic.
It sold 2 million copies — is that really a flop? You're just getting suckered by some stale clickbait gaming blog.
For a game that size, 2 million is a straight-up flop. Former PlayStation exec Yoshida even told overseas media, 'With labor costs and everything else up, making a game the same scale as a PS4 title today would cost twice as much. A first-party AAA title needs to sell 10 million copies just to break even.' Even if Death Stranding sits somewhere between AA and AAA, 4-5 million should be the bare minimum — especially with all that money blown on movie-star casting.
If it were some super-niche title, 2 million would be god-tier. But for mainline 3D Mario, that'd be an instant 'dead franchise' verdict. And for GTA, it'd basically be the end of the world — even 20 million would get called a failure there. In the end, whether a sales number counts as a pass or fail depends entirely on the expectations riding on that specific game, so calling 2 million a 'pass' is really just underselling how far it fell short. If Sony really cut ties, that means even they don't see (Dis)Stranding — a mocking mangled nickname posters use for the game — as a success.
It was announced around 2021 — but the project itself started before that.
They did put out Death Stranding 2 in the meantime, though. Guess PHYSINT just wasn't making much progress.
Because Metal Gear and Death Stranding were both incredibly fun and sold like crazy.
Steam's not exactly going to bankroll the project, is it.
Since Microsoft's funding it, it's a lock for Game Pass day one.
Seriously this. After finishing Death Stranding 2 and Ghost of Yotei, I had nothing left to play on my PS5, so I sold it.
They killed the Walkman too. They clearly want out of manufacturing and development altogether — they've fully pivoted to living off finance and IP licensing.
Now that I think about it more, I was thinking of someone else.
They gutted Japan Studio, and shut down Bluepoint who handled their remakes — it's just gross.
Ditching Japan Studio really was shocking.
It's not just an image — that's exactly how it is.
Business is genuinely doing well, no question. But that's thanks to in-game spending on live-service titles like Apex, Fortnite, Genshin, and Star Rail — it's just that where the revenue comes from has changed.
Games used to be made and sold for profit, but now PlayStation just has to be the platform, and the microtransaction money pours in on its own. In that world, there's no need to force through an expensive game.
If it had been about blazing the Silk Road across China, I'd have wanted to play that.
If they're doing a sequel, at least swap the protagonist and set the delivery job in a completely different-looking world. Don't make me deliver packages through the same scenery twice.
Not really sure what point you're trying to make 😅
Does it help if I put it this way: whether 2 million counts as a success depends on the specific game? Sony dropped (Dis)Stranding, so obviously they don't consider 2 million a success.
Using a comparable scale to Kojima, Nagoshi's Like a Dragon (Yakuza) series is said to run about ¥15 billion in budget, so let's use that as a reference. Assuming a ¥8,000 retail price and factoring in distribution margins, royalties, and manufacturing costs, that leaves roughly ¥4,000 profit per copy.
At that rate, you'd need to sell 3.75 million copies just to avoid a loss. And merely avoiding a loss isn't success, so you'd want another million copies on top of that for actual profit.
So I'd guess 4.75 million was the bare minimum Sony was hoping for.
That's all just your own imagination though.
Probably because back then he was just an employee.
Background and Key Points of Discussion
PHYSINT is an espionage-action project from Kojima Productions and Sony (SIE) announced in 2021, though development is said to have been underway even before that. As posters in the thread point out, this contract termination is being tied to Sony’s recent overall stance — dissolving Japan Studio, shutting down Bluepoint Games, and generally pulling back from one-off blockbuster productions in favor of shifting its focus toward microtransaction revenue from live-service titles like Apex Legends and Genshin Impact. The main flashpoint was how to judge Death Stranding 2’s performance: opinions in the thread split over whether its announced 2-million-unit sales figure should be read as “reasonable” or as a “flop.” Part of the backdrop here is an industry-wide shift in which the break-even sales threshold has climbed sharply due to soaring production costs for big-budget games, making it hard to judge profitability from raw sales numbers alone. Note that the estimate claiming “5 million copies were needed” and the posts suggesting Kojima misused other projects’ budgets during his Konami days are both unsubstantiated speculation and should not be taken as fact.
*This article is compiled as an excerpt and summary of the 5ch (Nandemo Jikkyo G) thread “[Sad News] Hideo Kojima Suddenly Dumped by Sony wwwwwwwwww.”
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