ZeniMax Media will focus on The Elder Scrolls, Fallout, Doom, Quake, and Wolfenstein franchises going forward, though id Software and ZeniMax Online Studios have received major layoffs.
According to Bloomberg’s Jason Schreier, ZeniMax Media will undergo a major overhaul and pivot its resources toward its biggest and most established franchise, namely The Elder Scrolls, Fallout, Doom, Quake, and Wolfenstein. However, Microsoft’s latest restructuring efforts will have Xbox eliminate 3,200 jobs, around 20% of the division’s workforce, over the next year, beginning with 1,600 cuts today. The latter includes major layoffs at id Software and ZeniMax Online Studios.
“Studios in the Bethesda organization like id Software (Doom) and ZeniMax Online Studios (Elder Scrolls Online) are not shutting down but are cutting a significant number of staff this morning, per sources,” said Schreier. While no additional details were provided regarding how resources will be redistributed internally, the strategy suggests Microsoft intends to focus development efforts on franchises with the strongest commercial recognition and long-term growth potential. The restructuring is part of a much larger transformation underway at Xbox following the appointment of Asha Sharma as CEO earlier this year.
In a message sent to Xbox staff and later shared publicly, Sharma confirmed plans to divest Ninja Theory and Undead Labs to undisclosed buyers, while Double Fine Productions and Compulsion Games will become independent studios once again under their founders. Meanwhile, Arkane Lyon will enter a consultation process to explore potential strategic options, including a possible sale or spin-off. She described the current financial performance of Microsoft’s gaming division as “not healthy,” while highlighting the need to “reset Xbox.” She also stated that no publicly announced games will be canceled as part of the restructuring, although layoffs will affect teams across the organization.
Compulsion Games and Double Fine have both issued statements following Sharma’s announcement, confirming they will once again operate independently.
