Microsoft-Owned Zenimax Begins Staff Redundancies

George Broussard, co-founder of 3D Realms, has indicated that Microsoft has begun cutting jobs at Zenimax, the parent company behind major studios like Bethesda (Fallout), id Software (Quake), Arkane (Dishonored), Machine Games (Wolfenstein), and Zenimax Online (Elder Scrolls Online).

Responding to a social media post suggesting that “Anyone not working on Fallout or Elder Scrolls is out,” Broussard wrote, “Oh is that public now? That’s exactly what I heard a few days ago.” His comment adds weight to growing speculation about a major restructuring within the Xbox-owned publisher.

Rumors have also surfaced that Arkane was in talks to negotiate its independence, potentially breaking away from Microsoft entirely. Meanwhile, reports indicate that Ninja Theory, the studio behind the Hellblade series including the recently announced sequel, is slated for closure. According to sources speaking to The Verge, staff were informed on Monday about the studio’s impending shutdown, though the team is reportedly seeking a buyer to avoid complete dissolution. Microsoft has not yet commented on these claims.

The situation is evolving quickly. Earlier reports suggested that Compulsion Games and Double Fine were also facing potential closure, alongside Ninja Theory. Kotaku reported that Microsoft is preparing to shut down Compulsion, while Bloomberg noted that all three studios are fighting for a future outside of Xbox ownership.

This wave of negative news comes just days after a surge of optimism for the Xbox brand during Summer Game Fest. The company had reversed its earlier cross-platform strategy, announcing that major titles like Gears of War: E-Day and Clockwork Revolution would be full Xbox console exclusives. However, shortly after, Microsoft revealed a steep decline in profitability and acknowledged that the Xbox division requires a fundamental business reset.