The number that keeps coming up is 3,200. That's how many jobs Xbox has cut across its network of studios, roughly 20% of the console division's total headcount. Half gone immediately, the remaining 1,600 set to follow over the next 12 months. For the people still showing up to work every day, that second wave hanging over them is the part that stings most.
Developers who spoke publicly after the cuts described the weeks before the announcements as a slow-burn anxiety spiral. When new Xbox CEO Asha Sharma dropped her "reset the business" memo in early June, staff started reading between every line. Nobody knew if it meant their project, their studio, or their job. The silence from leadership in response to direct questions was, in the words of one affected worker, "deafening."
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What happened inside the studios
Morgan Goin, a senior encounter designer at ZeniMax Online Studios (ZOS) who worked on The Elder Scrolls Online, described feeling "blindsided" despite knowing cuts were coming. She sits on ZOS's union bargaining committee, affiliated with the Communication Workers of America (CWA), and says some disciplines at the studio have been reduced to roughly a quarter of their previous size. The practical consequence is direct: The Elder Scrolls Online, a live-service game that lives and dies on regular content updates, will not be able to maintain anything close to its previous output pace. The studio's official Reddit statement confirmed that previously shared content roadmaps would be "shifting," with no concrete timeline to replace them.
At Bethesda Game Studios' Montreal office, designer Simon Prefontaine said his team works on "core franchises" like Fallout and The Elder Scrolls. They assumed that made them relatively safe. They were wrong. "We did not expect the scale of layoffs that we have here," he said. "We're stunned."
The ID Software situation is particularly grim
Perhaps the most striking story to emerge involves id Software, the Texas-based studio behind Doom, Quake, and Wolfenstein. Producer Andrew Willis was among nearly 100 staff cut, with the news arriving the day after the release of Revelations, a major expansion for Doom: The Dark Ages. Willis claims some team members worked 12 to 17 hours a day over multiple months to ship that expansion. He thought delivering it might protect the studio.
The cuts hit anyway. Willis and other former id staff allege that the majority of those let go were technical specialists who had mastered the id Tech engine, the proprietary toolset the studio has built games on since 1996. That's not a skill you pick up in a few weeks. Willis called it a "cultural institution" with a steep learning curve, and said the layoffs effectively threw decades of accumulated knowledge "into the trash can."
Xbox pushed back on claims the Texas team was "effectively wiped out," stating it still has "dozens of people working on id Tech across multiple locations." The studio itself posted that it retains "the crew to build the games and tech we're known for." Willis and his former colleagues see it differently.
The strategy behind the cuts
Sharma's pivot is a deliberate departure from former CEO Phil Spencer's Game Pass-first approach. The subscription service, positioned as Xbox's answer to Netflix, reportedly fell short of Microsoft's subscriber targets. Sharma has said the broad-release strategy left the company "over-extended." The new plan concentrates resources on blockbuster franchises, with the goal of getting new entries in major series to players faster.
Industry veteran Fernando Rizo, co-host of the Business of Video Games podcast, acknowledged the cuts were "brutal, awful" while also pointing out that The Elder Scrolls 6 has been in development for roughly a decade without shipping. There's a real argument that some structural change was overdue. The problem, as affected workers see it, is that the execution eliminated irreplaceable experience along with the excess.
1,600 more cuts still coming
The part that makes it hard for remaining staff to feel settled is the math. Half the 3,200 cuts have already landed. The other half arrive over the next year, with no published schedule for when or where. Prefontaine put it plainly: "Those who remain know that one day they will be on the chopping block."
CWA-affiliated unions are planning rallies outside six Microsoft locations as they push to begin "effects bargaining," the process through which severance terms and potential reinstatements get negotiated. Goin, who has survived three rounds of layoffs across an 11-year career in games, framed it as fighting for something more basic than severance. "I would like for people to have lifelong careers that are sustainable," she said.
The broader industry context doesn't help morale. Close to 58,000 game industry jobs have been cut worldwide since 2022, a hangover from the pandemic-era hiring boom that saw studios and publishers expand aggressively on the assumption that elevated player spending would hold. It didn't.
For players, the immediate concern is content. Live-service games like The Elder Scrolls Online run on the assumption of consistent updates. Gutting the teams that produce those updates, then asking the remaining staff to maintain output, is a tension that no amount of corporate messaging resolves. If you want to stay current on what's still shipping from Xbox's studios, the gaming guides section has you covered for what's actually playable right now, including coverage of titles still receiving active support like our Hollowbody before you buy guide for Xbox Series X players looking for what's worth picking up amid the uncertainty.
