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Bethesda, id Software reportedly hit hard by Microsoft layoffs

7 July 2026 at 19:52

In announcing plans for 3,200 layoffs across the Xbox division yesterday, CEO Asha Sharma focused on discussing cuts to the Xbox platform team and redundant layers of middle management. Now, though, word is filtering out about significant staffing cuts at remaining Microsoft-owned game developers including id Software and Bethesda.

Apogee and 3D Realms founder Scott Millerβ€”who helped publish some of id's earliest gamesβ€”wrote on social media yesterday of "insider reports" that a majority of id had been laid off, "including most (if not all) coders." And last night, veteran programmer Michael Maynardβ€”whose credits at id Software date back to 2011's Rageβ€”wrote on LinkedIn that he was among the "roughly 50%" of the id team that was let go Monday.

Game Developer cites "multiple anonymous sources" in confirming those reports, saying the redundancies amount to about 90 employees at the Doom studio. The first DLC pack for last year's Doom: The Dark Ages launched earlier today.

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Β© id Software

The incredible shrinking Xbox: Five studios, 3,200 employees let go

6 July 2026 at 16:01

Last month, Xbox executives laid out some "hard truths" about Microsoft's struggling gaming division that they said would require a difficult "Xbox reset." This morning, Microsoft revealed the brutal shape of that "reset," announcing plans for 3,200 layoffs and the divestment of five smaller studios that the company has spent years acquiring and shepherding.

Half of those 3,200 layoffs are effective today, new Xbox CEO Asha Sharma wrote, while the other half will come by the end of Microsoft's 2027 fiscal year (which runs through June 30, 2027). CNBC cites "a person familiar with the matter" in reporting that these cuts amount to roughly 20 percent of the Xbox division.

When combined with 1,600 newly announced layoffs across the rest of Microsoft, the company as a whole is letting go of just over 2 percent of its workforce. But The Seattle Times reports that Microsoft's total headcount has remained relatively stable thanks to other hiring.

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Β© Aurich Lawson

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