The Competition and Markets Authority has made a U-turn in its findings and insisted 'Call of Duty' Xbox "exclusivity' would be "significantly loss-making" for Microsoft.
The UK's regulator is currently investigating the tech giant's proposed acquisition of Activision Blizzard, and it has "a significant amount of new evidence" that has meant they've amended their provisional findings published in February.
According to a statement, the CMA investigations team "reached the provisional conclusion that, overall, the transaction will not result in a substantial lessening of competition in relation to console gaming in the UK."
However, after getting a better "insight", the CMA no longer believes it will be "profitable".
It said: "While the CMA's original analysis indicated that this strategy would be profitable under most scenarios, new data – which provides better insight into the actual purchasing behaviour of CoD gamers – indicates that this strategy would be significantly loss-making under any plausible scenario.
"On this basis, the updated analysis now shows that it would not be commercially beneficial to Microsoft to make CoD exclusive to Xbox following the deal, but that Microsoft will instead still have the incentive to continue to make the game available on PlayStation."
Microsoft has vowed that it is committed to providing long-term equal access to 'Call of Duty' across all gaming platforms, providing more choices for players and enhancing competition in the gaming market.
The deal was announced in early December and a decision will be made by the CMA by April 26.
In the EU, regulators have pushed back their final decision to May 22.
