Following Microsoft's announcement of 3,200 job cuts across its Xbox division, reports have emerged that its owned game studios — including id Software and Bethesda — have been hit especially hard. While CEO Asha Sharma's announcement emphasised cuts to the Xbox platform team and redundant middle management, subsequent accounts point to deep losses among the developers behind franchises such as Doom, Quake and The Elder Scrolls. The scale of the cuts matters because it affects some of the industry's most storied studios and raises questions about the future of several major games.

At id Software, insider reports and affected staff suggest roughly half the team — around 90 employees, including many or most coders — was let go, just as the first DLC for Doom: The Dark Ages launched. Co-founder John Romero expressed sorrow and urged Microsoft to preserve id's code and documents. Bethesda Studios were reportedly also badly affected, with President Jill Braff telling staff the company must "change course" and focus on its strongest franchises — potentially bad news for newer titles like Starfield and for The Elder Scrolls Online, which reportedly lost up to half its developers. Microsoft plans a further 1,600 cuts over the fiscal year.