The Xbox system update released on August 12, 2026, comes with a handful of useful features beyond typical bug fixes and performance improvements. The update this time included features for Game Pass subscribers and those who play Xbox 360 games. It also follows cool new features released earlier in the summer involving power consumption, customization and other settings.
Most significant is that Game Pass subscribers no longer have to wait for their games to update if they’re also available cloud gaming and set the game to update once they’re done playing. The update also adds the ability to restore previously synced cloud saves in compatible games. So far, the only supported title is “Forza Horizon 6,” but Xbox says more will be added in future updates
If you play Xbox 360 games, you’ll notice that those titles now have game hubs where you can check your achievements and other info. On the topic of Xbox 360 achievements, the update adds detailed popups and shows older Windows Phone games in your achievement history.
Finally, the update makes it easier to wishlist and manage games. Users can now wishlist upcoming and released titles from their game cards, and the maximum has been expanded to 1,000 games. The system also adds a badge that makes it clear if your games or add-ons come from subscriptions.
If your Xbox doesn’t automatically update, go to Settings > System > Updates to start it manually.
2026 has been a rough year for Xbox
The August update’s new features mark a good, if minor improvement in what has otherwise been a tough year for Xbox fans. In February, the company announced a new head for Microsoft Gaming, Asha Sharma, who replaced longtime Xbox leader Phil Spencer. Since then, the Xbox team has undergone massive restructuring efforts, including a July announcement of plans to lay off 20% of staff, or about 3,200 workers. Half the cuts happened with the announcement, and the others will occur through the company’s 2027 fiscal year.
Xbox also divested from several of its video game studios as part of the news. That’s a dramatic change from the company’s acquisition spree of the late 2010s and early 2020s, an effort that the company now says failed to create enough critical and commercial success.
Given how many hits the brand’s reputation has taken recently, there are some clear disadvantages to buying an Xbox in 2026. Still, for those already in that ecosystem, updates like this improve the overall experience, even if it’s just slightly.
These updates also help to build hype for Microsoft’s next Xbox, which was announced earlier this year under the codename, Project Helix. Though the company hasn’t said much yet, rumors are that it might include features like the ability to digitize physical games.
