While Microsoft's seemingly unending spree of Xbox layoffs has often swept right over core tentpole studios like Fallout and Elder Scrolls maker Bethesda Game Studios, this week's historic downsizing was different.
Among 3,200 cut jobs – 1,600 of which were eliminated immediately – Elder Scrolls Online studio ZeniMax Online, Avowed and Pentiment developer Obsidian, and Doom studio id Software were all impacted by significant cuts. Perhaps most surprisingly, even Bethesda Game Studios proper, the studio currently working on The Elder Scrolls 6, had its workforce reduced as part of the restructuring.
Many US-based BGS employees are protected by the Bethesda Game Studios Union (BGSU), which ideally will help to provide adequate severance pay and support for impacted developers, but the labor union is nonetheless outraged by what it sees as a continuous punishing of workers for mistakes made my management.
A previous statement blasted Microsoft's repeated layoffs as "a stressful annual routine," and a new message shared to Bluesky confirms what everyone had suspected: that the layoffs primarily targeted developers on the ground, not management.
"Yesterday’s layoffs at Bethesda Games Studios were not a cut of '14 layers of management,'" reads the post, which refers to Xbox CEO Asha Sharma's layoff announcement and the mention of a byzantine management structure as one focus of the company's big reset. "We lost dozens of programmers, artists, designers and testers. Many of whom worked at BGS for decades," says the BGSU.
One way you can show Microsoft your concern is here through the XBOX Player Voice feedback platform: feedbackportal.microsoft.com/feedback/ide...
— @bethesdaunion.bsky.social (@bethesdaunion.bsky.social.bsky.social) 2026-07-08T19:11:02.752Z
The BGSU advises fans who are worried the latest Xbox cuts will impact the quality of the studio's games, "like [The Elder Scrolls 6," to make their voices heard. The union points to a post shared to Microsoft's feedback portal that demands Xbox "end studio closures and stop the cycle of layoffs" and lays out a list of requests co-signed by over 1,900 votes.
This week's Xbox's layoffs are the largest to ever hit the company and will stretch through the end of the 2027 fiscal year. That means some 1,600 Xbox employees will be nervously anticipating bad news for almost another year. Now it just boils down to hopes that we won't see additional cuts to Microsoft's gaming division.
