Work on The Elder Scrolls 6 has reportedly been badly disrupted by the latest round of Xbox layoffs, with more than 50 key staff at Bethesda Game Studios among those let go. According to an IGN report citing anonymous employees, the losses have "shattered" morale and raised fears of crunch and further delays to a game that is already said to be years away from release. The cuts matter because they strike a highly anticipated title and reflect wider turmoil across Microsoft's gaming division.

The affected staff span every discipline, including programmers, artists and designers, and reportedly include someone who had worked at Bethesda since Morrowind. The redundancies form part of a broader Microsoft restructuring expected to total around 3,200 job losses, driven by a strategy shift under Xbox lead Asha Sharma that has also seen Double Fine and Compulsion return to independence and Ninja Theory and Undead Labs sold to unconfirmed buyers. Staff fear replacements will be cheaper contractors or new hires needing lengthy onboarding on Bethesda's proprietary tools, prolonging development; the Bethesda Game Studios Union also says a "Celebration of Service" for departing colleagues was set up in a common area but removed almost immediately by HR.