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It has been one hell of a week for XBOX owned studios. Around 1,600 employees have been laid off, with the promise of another 1,600 layoffs to come in the months ahead. One of those studios, id Software, was apparently one of the hardest hit with a reported 50% of the studio laid off.

There were reports saying that most, if not all, of the people working on id Tech were included in the layoffs. Earlier this week, Kotaku reported that the id Tech...

Avowed sequel canceled.

A new report from Bloomberg sheds more light on what is going on at Obsidian Entertainment in the wake of the mass layoffs that impacted all XBOX studios in some capacity this week. We know already that roughly 25% of Obsidian employees were laid off this week. Due to these extensive layoffs, several projects have been canceled.

According to Bloomberg, one of the known cancelations at Obsidian was a sequel to 2025's Avowed. The report says that...

The MMO teams from ZeniMax and Bethesda were hit "particularly hard."

Several Fallout developers have shared that they lost their jobs as part of yesterday's mass layoffs across all of XBOX. Many of those who shared word of their layoff were quest designers on Fallout 76. This includes the former leader writer for Fallout: London, Stephanie Zachariadis, who was hired by Bethesda Game Studios in 2021.

Zachariadis says, "After five years, I was just laid...

Laid off a day before the new DLC released.

Update as of July 8, 2026: According to updated reporting, the number of employees laid off from id Software has now hit at least 136.

A WARN Notice filed in Texas confirms that 158 people were laid off from ZeniMax just within the state of Texas. The notice was sent to Gamedeveloper.com after a request was made by the Texas Workforce Commission.

Of those 158 employees that were laid off, 136 come from id Software....

No department was spared.

One of the biggest workhorses for XBOX was Obsidian Entertainment. The studio somehow managed to release three titles in 2025 alone: Avowed, Grounded 2 (in Early Access), and The Outer Worlds 2. Yet even Obsidian was not spared from the recent layoffs across all of XBOX.

According to sources speaking with Kotaku, somewhere between 60 and 70 employees were laid off. The layoffs include producers, artists, designers, programmers, QA testers, writers,...

Despite the word that the Xbox divisions would be safe from the massive 18,000 person layoffs that were hitting Microsoft, it seems that the reality of the situation is quite the opposite. Microsoft is going to shut down the Xbox Entertainment Studios in Santa Monica. That particular branch employees roughly 200 employees w ho will soon be looking for new jobs in the coming months. This particular studio has been a key component of Microsoft's ongoing vision for the Xbox by attempting to ...

Despite the word that the Xbox divisions would be safe from the massive 18,000 person layoffs that were hitting Microsoft, it seems that the reality...