Casualties of Microsoft’s massive layoffs to its Xbox division continue to be discovered, as current leadership lays blame on the decisions of the previous CEO. Asha Sharma, the current CEO of Xbox, was fairly blunt in her Resetting Xbox post regarding the current round of layoffs in progress. By the way, while most media continues to spell Microsoft’s gaming division as Xbox, Sharma did make it a point to use her all-caps version XBOX, another change she decided upon several weeks back. Citing subpar margins, such as being 3-10x lower than similar platforms or that of other publishers, it was pointed out how the past strategy of investing in Game Pass, multi-platform releases, and portfolio expansions did not yield expected growth rates. Confirming weeks of rumors, four studios were officially listed as being let go of in yesterday’s announcement, but it’s also come to be known that id Software, the developer behind the immensely popular Doom franchise, has seen roughly half of its staff cut. This must also be assuredly with another statement made by Sharma.
“We have also learned that we are not the best home for every type of studio; in a typical year, we lost 64 cents for every dollar we invested. As we reset XBOX, we will help independent creators succeed by providing open development tools and audiences to realize their vision.”
– Asa Sharma, Xbox CEO
According to Game Developer, its sources have said upwards of 100 people were let go from id Software. In addition, Bethesda president Jill Braff confirmed that ZeniMax, a partner studio to id Software, is also being restructured. It has been reported that Bethesda’s main focus will now be on its other IPs such as Fallout, Elder Scrolls, and, oddly enough, Doom and Quake, which seems counterproductive given these layoffs. Perhaps AI will be the answer, despite claims by Microsoft that it will not be the case.
Microsoft’s Accessibility efforts are also reportedly included in the carnage of layoffs. Per VGC, a program manager reported in June that they were expected to be cut when staff reduction began, and a test lead has since confirmed that they too were being let go. It appears that more staff from Microsoft’s Accessibility teams are speaking out that they too are being laid off, thus showing how Microsoft’s initiative is yet another victim of the company’s major restructuring.
Investors will likely see a short-term positive to all these cuts because it’s well known that staff cuts are a means to immediate revenue cost adjustments, resulting in what can appear to be long-term profits, but it remains to be seen if Sharma’s team can create a sustainable long-term strategy.
Discussion (11 replies)
Join Discussion →the situation with id software is very unfortunate — as they were the pioneers of PC gaming
I believe the situation has to do with Xbox being forced to use unreal across all games — as a part of toolset/skillset standardization. so they have no need for a vulkan based engine — as the future is unified GDK based on RDNA 5 (AMD supports only direct x 13 & not vulkan for FSR 4/5 etc.)
I wonder why id tech engine was not integrated much earlier with Bethesda/zenimax etc.? that could have saved it...
I don't even wanna talk about the f*cking id Software situation. Also just found out the guy who led the back-compat team (and also led the cloud gaming team) was also laid off, after 37 years at Microsoft. No one is safe. But we already knew that if they're getting rid of coders at id Software, which is about the absolute DUMBEST f*cking thing you could do to that company.
Yeah, I love how they include Doom and Quake as games they're going to focus on after gutting the company. Seriously wtf.
Skeleton crews using AI slop?
they'll recruit contractors for UE5 / UE6
not sure about id.tech games, tho
“id Tech as a technology is probably dead forever.”
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By Ethan GachPublished July 9, 2026
Key positions were cut and entire teams were decimated, three sources told Kotaku. This included the team in charge of id Tech, the studio’s long-standing proprietary game engine for the Doom franchise. Sources said only one employee on that team is believed to be left.
Doom isn’t the only franchise that relies on id Tech. A branch of it is used by MachineGames on the Wolfenstein games, including the sequel it’s currently developing. Every so often those branches are merged when one side has tech improvements the other would like access to. One source said some of the most recent improvements occurred during the development of Revelations. Following the cuts to the engine team, they weren’t sure who would be left to help MachineGames get access to them and keep them from going to waste.
[URL unfurl="true"]https://kotaku.com/the-cuts-at-doom-maker-id-software-go-shockingly-deep-i-dont-see-how-they-make-a-game-with-that-team-2000713860[/URL]
Yep and my guess it also means we'll never see another Indiana Jones game, really bummed about that since I love that game, nor any meaningful DLC for it either.
update:
apparently more than a dozen people support the engine (for other games/studios probably) from the frankfurt location — which operates under more strict German labour laws
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I just love that ID was founded in Texas... and is now a token office kept in place only by fond memories... it sucks actually. But really location has little to do with extracting money from it any more.
We will never see another Oh Holy CRAP look what IDtech engines do now!
It'd be too much to hope for id to just open source the engine or set up some kind of free licensing for it.
Would be curious what could be done with it if it was just out there for people with the knowledge to use.
more:
Following layoffs, Frankfurt is now home to the majority of id's id Tech engineers, with two others residing in Dallas. That said, other Zenimax studios also work on the id Tech engine.
The id Tech engine, regarded by many as a miracle of optimization, has been a point of concern following recent layoffs. Some employees have claimed that Microsoft <u>tossed crucial institutional knowledge</u> about its basic functions out the window, effectively killing it. In <u>a statement posted to Twitter</u> today, id contested that characterization of events:
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