Perfect Dark canceled, studio shut down amid thousands of layoffs at Microsoft

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Today, it’s reported that Microsoft is letting go of around 9,000 employees across all departments, including an undisclosed number from their gaming division. According to initial reports by the Seattle Times, this gaming titan has also allegedly scrapped several games and shut down at least one studio. The revival of Perfect Dark has been halted, and the development team, The Initiative, has been closed down. Additionally, an MMO from ZeniMax and the long-developing Everwild from Rare have both been canceled. This announcement comes at a time when Microsoft’s stock price is reaching new highs and they are reporting billions of dollars in revenue.

Thousands of employees laid off, Perfect Dark canceled, studio closed, as Microsoft continues to make billions

In simpler terms, Phil Spencer, head of Microsoft Gaming, addressed his team today in an email, which you can find in full at VGC. While the language is mostly business jargon, Spencer does highlight that Xbox has more players, games, and gaming hours than ever before. However, this positive statement comes alongside news that a significant number of employees could be losing their jobs, making his message feel somewhat insincere.

The story surrounding this news is quickly unfolding as additional details emerge, with Jason Schreier from Bloomberg providing substantial coverage. Through posts on BlueSky, Schreier has disclosed layoffs at various studios such as the Call of Duty studio Raven Software and reportedly half of the staff at Forza Motorsport developer Turn 10. Moreover, Schreier has confirmed that a project from Elder Scrolls Online studio Zenimax Online has been terminated. This shelved project was a new MMORPG, codenamed Blackbird, which had been in development since 2018.

Matt Booty, the Head of Xbox Game Studios, announced the shutdown of The Initiative, the studio responsible for the upcoming reboot of the game _Perfect Dark_, which was unveiled at the 2024 Xbox Summer Showcase. In a statement, Booty explained that this decision is part of a larger strategy to readjust priorities and channel resources towards ensuring the success of their teams amidst the evolving video game industry landscape.

In a CNBC report, Stephen Totilo from Game File highlighted that Microsoft earned almost $26 billion in net income on $70 billion in revenue during the March quarter, maintaining its position as one of the most profitable companies within the S&P 500 index. Moreover, Microsoft’s stock recently reached an all-time high of $497.45 per share six days ago. However, it seems puzzling that a company flourishing financially would still decide to disrupt the lives of thousands of employees in such a significant way.

In January 2023, about 10,000 Microsoft employees were let go, marking the largest number of layoffs for the company since 2023. However, it’s important to note that they aren’t the only ones experiencing redundancies. For instance, in January 2024, 1,900 employees were confirmed laid off across Activision Blizzard, Bethesda, and Xbox following their acquisition. And, unfortunately, more layoffs were announced both in September 2024 and earlier this year as well.

This method of developing video games is unsustainable, leading to a situation where numerous individuals are currently grappling with their immediate future. Some may feel compelled to relocate, disrupting their families, support systems, and communities, for employment opportunities elsewhere. Numerous developers might abandon the gaming industry altogether, owing to limited job prospects, instability, or sheer fatigue. We risk losing numerous talented creators and innovative games that may never see the light of day because of these circumstances.

I wish a brighter future for everyone impacted by this devastating news, where they find employment that values them and offers the stability, security, and dignity they deserve. The video game industry has the potential to set a higher standard for its workers who create such incredible games. It’s encouraging to see employees at Blizzard taking steps towards unionization, and I hope this serves as an example for more game developers to follow suit.

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2025-07-02 23:32