Xbox Layoffs: Id Software & Obsidian Devs Cut - What's Next for Xbox Studios? (2026)

The recent wave of layoffs at Xbox has sent shockwaves through the gaming industry, with Id Software and Obsidian Entertainment being particularly hard-hit. The scale of these cuts has been staggering, with reports suggesting that Id Software's coding team has been gutted and Obsidian has lost 60-70 developers. This has led to a wave of emotional farewells on LinkedIn, with long-time employees expressing gratitude for their time at these studios. The impact of these layoffs extends beyond the individual developers, as it raises questions about the future of these studios and the broader gaming industry. The cuts come as Microsoft plans to restructure Bethesda around its strongest franchises, which could have significant implications for the future of these studios and the games they produce. The gaming industry is at a critical juncture, and these layoffs serve as a stark reminder of the challenges it faces. The future of these studios and the games they produce is uncertain, and the impact of these layoffs will be felt for years to come. The gaming industry is at a crossroads, and the decisions made in the coming months will shape its future.

Xbox Layoffs: Id Software & Obsidian Devs Cut - What's Next for Xbox Studios? (2026)
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