# Xbox Game Pass falls short of targets, prompting layoffs at Microsoft studios

- URL: https://talkfuse.com/story/xbox-game-pass-subscriber-shortfall-triggers-major-layoffs-across-microsoft-studios/
- Published: 2026-07-06T20:14:43+00:00
- Updated: 2026-07-07T17:03:17+00:00
- Topics: Art, Culture, Entertainment, Gaming, Music

## Key points

- Xbox Game Pass has underperformed, reaching ~30 million subscribers far below Microsoft's targets
- The subscriber shortfall has prompted layoffs across Xbox-owned studios including Obsidian Entertainment
- Job cuts affect staff at all career stages, from veteran employees to recently hired workers

## Summary

Xbox Game Pass has underperformed significantly against Microsoft's expectations, with the service reaching only approximately 30 million subscribers—a substantial gap below the company's targets. The gap has prompted cost-reduction measures throughout the Xbox organisation, leading to employee reductions across its owned development studios.

Obsidian Entertainment, a Microsoft-owned developer, has been substantially affected by the restructuring. The studio's workforce reductions span career-stage experience levels, eliminating both long-standing team members with extensive tenure and newly onboarded staff who had minimal time at the company, reflecting the breadth of the cost-cutting exercise.

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Summarised by TalkFuse (https://talkfuse.com/). Quote the original publisher for the reporting and link this page for the summary and discussion.