Layoffs at ZeniMax Reportedly Started, Only Elder Scrolls and Fallout Teams Spared

Key Takeaways

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ZeniMax Media is undergoing extensive layoffs, primarily affecting employees not involved in Fallout or The Elder Scrolls projects.
Microsoft is reportedly in discussions with Compulsion Games, Double Fine Productions, and Ninja Theory about potential sales or closures due to a lack of recent successful game releases.
Microsoft has approved increased spending for Fallout, The Elder Scrolls, and Halo, but release dates for The Elder Scrolls VI and Fallout 5 remain uncertain.
Uncertainty surrounds the future of id Software and ZeniMax Online Studios within Xboxs restructuring, as both studios have faced recent disruptions and potential cutbacks.

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Layoffs are reportedly underway at ZeniMax Media, a development that is expected to be more extensive than initially thought. Sources suggest that employees not working on Fallout or The Elder Scrolls projects are at risk. This news builds upon earlier speculation that only those involved with these two major franchises might be spared from the cuts. George Broussard, co-founder of 3D Realms and Apogee and a creator of the Duke Nukem franchise, confirmed the ZeniMax layoffs have begun. “I’ve heard that layoffs at Zenimax have begun,” Broussard wrote on X. “I’ve heard rumors recently that these cuts may be much deeper than you imagine.” Broussard’s social media posts on Wednesday indicated that the layoffs started on that day and that he had received similar information from his sources, aligning with rumors that only teams working on Elder Scrolls and Fallout would be unaffected.

Earlier in the week, reports indicated that Microsoft was in negotiations with Compulsion Games, Double Fine Productions, and Ninja Theory regarding potential sales or independence before potential closure. These developments come amid broader speculation about mass layoffs within Xbox. A French journalist had identified Bethesda Game Studios, Arkane Lyon, and id Software as potential targets for layoffs or studio closures within ZeniMax Media. Sylvain Trinel of BFM TV later added these three studios to the list of those that would be affected by layoffs or closures. The potential closure of Compulsion Games, Double Fine Productions, and Ninja Theory is linked to a perceived lack of recent successful game releases from these studios. This wave of restructuring follows earlier Xbox layoffs in July 2025, which led to the cancellation of ZeniMax Media’s Project Blackbird and the departure of Firor from ZeniMax Online Studios. If id Software and ZeniMax Online Studios face further reductions or closure, ZeniMax Media would be left with Bethesda Game Studios, MachineGames, and Arkane Lyon.

Expanded Microsoft Spending on Fallout, Elder Scrolls, and Halo, Yet Uncertainty Surrounding id Software and ZeniMax Online Studios

Microsoft’s Chief Financial Officer, Amy Hood, has approved increased spending for Fallout, The Elder Scrolls, and Halo, beginning July 1, 2026. However, release dates for The Elder Scrolls VI and Fallout 5 remain unannounced. Arkane Lyon’s latest game, Deathloop, was released prior to Microsoft’s acquisition of the studio, and the status of their new project, Marvel’s Blade, is unclear. Reductions or closures at id Software (Doom) and MachineGames (Indiana Jones, Wolfenstein) would be surprising given their history of successful titles and strong brands. id Software’s job postings for ZeniMax disappeared from the company’s career portal on June 16, 2026. While Doom: The Dark Ages has sold approximately 800,000 copies, this figure has prompted questions about the studio’s position within Xbox’s restructuring, especially considering over three million players have engaged with their titles. ZeniMax Online Studios also faced disruption with the cancellation of Project Blackbird during the July 2025 layoffs, casting uncertainty on their current circumstances. If id Software and ZeniMax Online Studios continue to face cutbacks, Microsoft’s ZeniMax Media acquisition could effectively consolidate into Bethesda Game Studios, MachineGames, and potentially Arkane Lyon.

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