“My ‘Microsoft will probably be a good steward of the brand’ statement isn’t aging well” – id Software co-founder John Carmack speaks out after devastating Xbox layoffs
John Carmack, co-founder of id Software — the studio behind Doom and Quake — has publicly responded to sweeping layoffs at his former company following a major restructuring at Microsoft's Xbox division. New Xbox CEO Asha Sharma announced an initial 1,600 job losses, with a further 1,600 expected over the coming year, affecting numerous studios including Activision, Bethesda/ZeniMax, Blizzard and King. id Software was reportedly hit especially hard, prompting reflections from Carmack and fellow co-founder John Romero on the studio's uncertain future.
According to an official WARN notice, 136 id Software employees lost their jobs — 96 in the Texas office and 40 remote workers — leaving just 49 of the roughly 185 staff reported in December 2025. Carmack acknowledged his earlier confidence that "Microsoft will probably be a good steward of the brand" had not aged well, but said he could not muster anger, suggesting id was likely a "marginal business" for Microsoft and that Minecraft revenues had been propping up other studios. He argued that beloved games must still commercially succeed to survive, though he questioned whether any obvious strategy could have doubled id's revenue, concluding that he hoped "the studio rallies through." The news came a day before id released its Revelations expansion for Doom: The Dark Ages.
Both sides, in good faith
The strongest fair case each way — we don't pick a winner.
The case for
Microsoft inherited an expensive portfolio through acquisitions where some studios generated insufficient revenue relative to operational costs. Strategic consolidation becomes necessary to ensure the long-term viability of remaining operations and to meet shareholder expectations. These difficult restructuring decisions, whilst painful, may actually be more humane than allowing unprofitable divisions to linger indefinitely.
The case against
Microsoft's massive acquisition strategy followed by sweeping layoffs suggests a fundamental failure of planning and stewardship. Studios with decades of heritage and cultural significance were valuable precisely because of their creative communities, which are now dispersed. The pattern of boom-and-bust in gaming destabilises entire communities of creators, and Carmack's own reassessment suggests Microsoft overestimated its ability to sustain these studios responsibly.