What Obsidian Entertainment does

Obsidian Entertainment is an American role-playing video game development studio founded in June 2003 and headquartered in Irvine, California. The studio was acquired by Microsoft in 2018 and operates as a wholly-owned subsidiary within Xbox Game Studios, employing approximately 285 people as of December 2025. Its portfolio spans internally-owned franchises including The Outer Worlds, Pillars of Eternity, Grounded, Avowed, and Pentiment, plus Pathfinder Adventures, covering first-person RPGs, isometric party-based RPGs, multiplayer survival, and narrative adventures.

The studio develops games primarily on Unity alongside proprietary RPG design systems built over 20+ years, including real-time-with-pause combat, companion AI with relationship dynamics, choice-and-consequence narrative engines, and turn-based mode options. Core technical differentiators center on player agency systems and branching faction narratives rather than rendering or engine technology. Pillars of Eternity, Avowed, and The Outer Worlds share the Eora universe or comparable deep-lore worldbuilding that compounds franchise value across releases.

Obsidian's revenue model blends one-time premium game and DLC/season-pass sales ($32.49–$99.99) with recurring subscription exposure via day-one Xbox Game Pass placement. Distribution spans Steam, Epic Games Store, GOG, PlayStation, Nintendo Switch, and the Xbox Store, with Microsoft's 2026 platform-expansion strategy adding PS5 SKUs for Avowed and Grounded 2. The primary customer segments are RPG enthusiasts seeking narrative depth and Game Pass subscribers seeking day-one value, with a secondary multiplayer/co-op audience for Grounded 2.

Name

Obsidian Entertainment

Legal name

Obsidian Entertainment, Inc.

Website

https://obsidian.net

Company type

Private

Founded year

2003

Operating status

Operating

Headcount range

251–500 employees

Short description

Obsidian Entertainment is a Microsoft-owned RPG and action game studio in Irvine, California, developing narrative-driven titles such as The Outer Worlds, Avowed, Grounded 2, and Pillars of Eternity for PC, Xbox, and PlayStation audiences.

Ownership category

akta.pro rank

Headquarters

HQ city

Irvine

HQ country

United States

HQ region

North America

Offices1 record

Markets served

GTM type

B2C

Offering type

Software

Cost components

Personnel, Technology or R&D, Operations, Marketing or Sales

Revenue model

1. Game Sales (Premium Editions): Obsidian generates primary revenue through sales of base game editions ($69.99-$99.99) and premium/collector editions that include DLC passes, digital artbooks, and soundtracks. The Outer Worlds 2 Premium Edition ($99.99) includes DLC pass for 2 future story expansions and Moon Man's Corporate Appreciation Premium Prize Pack.
2. DLC and Expansion Sales: Downloadable content and story expansions are sold separately or bundled in season passes. The Outer Worlds 2 DLC Pass covers 2 future story expansions.
3. Platform Licensing and Port Revenue: Revenue from porting games to new platforms, such as Avowed's PS5 release in February 2026, which generated sales through the PlayStation Store.
4. Xbox Game Pass Day-One Releases: As a first-party Xbox Game Studios developer, Obsidian benefits from day-one Game Pass placement, which drives player acquisition and engagement without traditional upfront purchase requirements.

Pricing tiers

Go-to-market motion3 records

Distribution channels6 records

Marketing channels7 records

Core offering

Obsidian Entertainment is a video game development studio that creates single-player and multiplayer RPGs and action games. The studio's current portfolio spans original IPs including The Outer Worlds 2, Avowed, Grounded 2, Pentiment, the Grounded series, the Pillars of Eternity series, and Pathfinder Adventures. Games are sold as one-time digital purchases across Steam, PlayStation, Xbox, Epic, GOG, and Nintendo Switch storefronts, and are included on Xbox Game Pass at launch.

Product overview

Obsidian Entertainment is a video game development studio that creates single-player RPGs and action games. The company's portfolio includes both original intellectual properties (Grounded, The Outer Worlds, Avowed, Pentiment, Pillars of Eternity) and licensed titles. Games are distributed through multiple platforms including Xbox Game Pass, Steam, PlayStation, and Epic Games Store. The studio, founded in 2003 and acquired by Microsoft in 2018, develops games across various genres including survival multiplayer (Grounded series), first-person RPGs (The Outer Worlds series, Avowed), isometric RPGs (Pillars of Eternity series), and narrative-driven adventures (Pentiment).

Differentiator

Problem solved

Functional benefit

Products and services

• Grounded 2 Multiplayer survival game where players are shrunk to the size of ants and must survive in a backyard environment, featuring base-building, crafting, cooperative gameplay, various biomes, and boss encounters. Targeted at survival and co-op gamers on Xbox, PC, and PlayStation 5.
• The Outer Worlds 2 Single-player first-person sci-fi RPG and sequel to the award-winning original. Players explore the Arcadia colony, uncovering the source of devastating rifts threatening humanity. Features character customization, companion systems, faction-based choices, and branching narratives. Available on Xbox and PC.
• Avowed First-person fantasy action RPG set in the world of Eora (from Pillars of Eternity). Players explore the Living Lands as an envoy investigating a mysterious plague. Features fluid combat combining swords, spells, guns, and shields with four distinct skill trees. Available on Xbox, PC, and PlayStation 5.
• Pentiment Historical narrative-driven RPG set in 16th century Bavaria during the Reformation. Features a unique illustrated art style and focuses on mystery, intrigue, and community interaction across multiple time periods. Targeted at players seeking story-focused experiences.
• Grounded Original multiplayer survival game where players are shrunk to the size of ants and must survive in a backyard environment. Features cooperative gameplay, base-building, crafting, and various insect enemies and bosses. Available on Xbox, PC, and PlayStation.
• The Outer Worlds Original single-player first-person sci-fi RPG published by Private Division in 2019. Players wake from cryo-sleep aboard a colonist ship and must uncover a conspiracy threatening the Halcyon colony. Features faction-based choices and player-driven narrative.
• Pillars of Eternity Classic isometric RPG originally released 2015 via Kickstarter, set in the world of Eora with deep narrative, character progression, and party-based combat. Now includes optional turn-based combat mode. Available on PC, macOS, Linux, PlayStation 4, Xbox One, and Nintendo Switch.
• Pillars of Eternity II: Deadfire Sequel to Pillars of Eternity featuring real-time with pause combat and optional turn-based mode. Players explore the Deadfire Archipelago in a seafaring adventure with open-world exploration. Available on PC, macOS, Linux, PlayStation 4, Xbox One, and Nintendo Switch.
• Pathfinder Adventures Tactical card RPG inspired by the Pathfinder Adventure Card Game, developed by Obsidian Entertainment. Available on iOS, Android, and Steam, featuring deck-building mechanics and scenario-based gameplay. Targeted at mobile and PC gamers who enjoy tactical card-based RPGs.

Quantifiable outcome

• Produced 3 AAA-quality titles in a single year with only 285 employees
• +2 more outcomes

Named customers1 record

Segments4 records

Ideal customer profiles4 records

Technology focussed Yes

API detail

Has API

No

API docs

API detail

Core technology

AI maturity

App detail

Feature6 records

Partnerships

Four partnerships are on record, tiered minor, flagship and core.

• Private DivisionminorChannel Partner/ Reseller/ Distributor · 1 January 2019Private Division published The Outer Worlds (2019) under a pre-acquisition deal before Microsoft acquired Obsidian Entertainment in 2018.
• Microsoft / Xbox Game StudiosflagshipOthers · 1 January 2018Obsidian Entertainment was acquired by Microsoft in 2018 and operates as a first-party Xbox Game Studios developer. As part of Microsoft, Obsidian benefits from development funding, Xbox Game Pass distribution, and access to Microsoft's technology infrastructure while maintaining creative independence.
• Eidos-MontréalcoreStrategic or Co-development PartnerEidos-Montréal provides co-development support for Grounded 2. Game director Chris Parker noted that Obsidian and Eidos have optimized their collaboration over time. The studio has worked with Eidos on the Beat the Heat update and the upcoming Into the Abyss content update.
• Xbox Game StudioscoreOthersXbox Game Studios publishes The Outer Worlds 2 and other Obsidian titles. The publisher provides distribution through Xbox Store and Game Pass platform.

Scale indicators5 records

Recent moves4 records

Expansion highlights5 records

Direct peers

• Bethesda Game Studios: Fellow RPG specialist under Microsoft/Xbox Game Studios ownership, known for Fallout and Elder Scrolls franchises. Highly comparable as a Microsoft first-party RPG studio with overlapping genre focus, similar choice-driven narrative design, and shared Game Pass distribution.
• Larian Studios: Independent RPG studio behind Baldur's Gate 3, comparable in size (~500+ employees) and RPG specialization. Direct competitor for premium narrative-driven RPG mindshare and commercial success.
• BioWare: Long-established RPG studio (Mass Effect, Dragon Age) under EA ownership, with comparable narrative-and-choice-driven RPG design philosophy. Direct peer for talent competition and player mindshare in the same RPG genre.
• CD Projekt Red: Polish RPG studio behind The Witcher series and Cyberpunk 2077. Direct competitor in premium narrative-driven RPG space, though materially larger in headcount.
• inXile Entertainment: Sibling Microsoft first-party RPG studio (Wasteland, Torment) with similar narrative-RPG focus and Microsoft backing. Closely comparable in mission and ownership structure.
• Playground Games: Microsoft first-party studio developing the Fable reboot and Forza Horizon. Comparable as a Microsoft-owned, UK-based, large-scale RPG/AAA studio with similar distribution access via Game Pass.

Broad incumbents

• FromSoftware: Japanese AAA developer of Elden Ring, Dark Souls, and other action RPGs. Competes for premium RPG player dollars and time, though the core gameplay loop differs from Obsidian's choice-driven narrative RPG focus.
• Square Enix: Large global publisher/developer of Final Fantasy, Dragon Quest, and other RPG franchises. Indirect competitor for premium RPG market share, though much broader in scope and portfolio.
• Naughty Dog: Sony's premier narrative-driven AAA studio (The Last of Us, Uncharted). Comparable in narrative craftsmanship and production values, though action-adventure rather than RPG-focused.
• Larian Studios / Bethesda Softworks: Parent organization of Bethesda Game Studios (ZeniMax Media, now under Microsoft). Relevant as a peer entity competing in the open-world RPG category with The Elder Scrolls and Fallout franchises.

Market position

Strengths4 records

Weaknesses5 records

Competitive moat5 records

Key risks6 records

Key highlights6 records

Customer concentration

• Xx.com/obsidian
• YouTubeyoutube.com/user/ObsidianEnt
• Facebookfacebook.com/obsidian
• LinkedInlinkedin.com/company/obsidian-entertainment
• Instagraminstagram.com/obsidian

Revenue estimate

Valuation estimate

Number of profiles

Profiles6 records

Funding overview

Funding rounds3 records

Investors

Funding detail is available on the Subscription and Enterprise plan.Contact sales →

M&A

Investments

M&A and investment is available on the Subscription and Enterprise plan.Contact sales →

Frequently asked questions about Obsidian Entertainment