Microsoft Corporation Lays Off 3,200 Gaming Staff and Divests Studios

Microsoft executed mass layoffs of 3,200 employees across its gaming division, representing 20% of total Xbox staff. The cuts heavily impacted id Software, where approximately 136 developers—roughly 73% to 75% of the workforce—were terminated. These layoffs occurred just one day before the release of the Revelation DLC for Doom: The Dark Ages, a product that subsequently received rave reviews on Steam and Opencritic.

Microsoft Corporation also cut staff at Bethesda and ZeniMax Media, affecting employees in Rockville and Cockeysville, Maryland. Alongside these reductions, Xbox CEO Asha Sharma announced the company will sell Ninja Theory and Undead Labs, while allowing Compulsion Games and Double Fine to become independent. This marks the fifth round of mass layoffs since Microsoft's $75 billion acquisition of Activision Blizzard.

Responses to the cuts have been polarized. Doom: The Dark Ages director Hugo Martin denied reports that the studio was "gutted," asserting the team is the same size as it was during the development of Doom 2016. Conversely, a laid-off developer accused the company of destroying "an immense amount of value." id Software co-founder John Carmack expressed regret over his prior optimism, stating his belief that Microsoft would be a good steward of the brand has not aged well.