More Xbox cuts could be on the horizon, new report claims

Microsoft has been criticized for shutting down four ZeniMax studios this week, but it might not end there, as more Xbox cuts are reportedly on the way.

Tom West

Published 09 May 2024

It's been a tough week for the games industry as we watch fantastic studios like Tango Gameworks and Arkane Austin close for good. Unfortunately, it doesn't look like Microsoft has finished gutting its teams either, as a new report claims more Xbox cuts could be on the way.

Microsoft reportedly making more cuts across Xbox

Bloomberg's Jason Schreier reports that the ZeniMax studio closures are part of an ongoing "cost-cutting initiative that still isn't finished." Many employees across Xbox have reportedly been told that more cuts are on the way, while "voluntary severance agreements" have been offered to a number of QA testers, producers, and other staff across ZeniMax.

It's still unclear why Microsoft decided to close Tango Gameworks after the success of last year's Hi-Fi Rush, but according to a report, head of Xbox Game Studios Matt Booty has attributed the closures to the need to free up resources across its studios. During a recent town hall meeting within Microsoft, Booty reportedly said that Xbox's studios have been spread too thin "like peanut butter on bread," leaving many divisions feeling understaffed.

As for Arkane Austin, Booty didn't reveal why it had been closed either, but it apparently has nothing to do with Redfall's underperformance — which has now been put out to pasture without any new updates, including one that could have saved Redfall's achievements in the future. Schreier reports that Arkane had actually pitched a new single-player immersive sim that would allow the studio to "return to its roots," such as the Dishonored series.

“It’s hard to support nine studios all across the world with a lean central team with an ever-growing plate of things to do," head of ZeniMax Jill Braff reportedly said during the townhall, later adding, "I think we were about to topple over." The report says that Braff hopes the reorganization with ZeniMax will allow its teams to focus on fewer projects.

Back in January, Microsoft hit the headlines for laying off around 1,900 employees across Xbox, Activision Blizzard, and ZeniMax following its $69 billion acquisition of Activision Blizzard.

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Written by Tom West

Tom has been playing video games since he was old enough to hold a controller, experimenting with a number of systems until he eventually fell in love with Xbox. With a passion for the platform, he decided to make a career out of it, and now happily spends his days writing about that which he loves. If he’s not hunting for Xbox achievements, you’ll likely find him somewhere in The Elder Scrolls Online or fighting for survival in Battlefield.