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Microsoft layoffs: Job cuts in Xbox division lead to game cancellations and shutdown of key studios
Microsoft’s July 2 layoffs have hit Xbox, leading to the closure of studios like Arkane Austin and Tango Gameworks, and the cancellation of multiple in-development games across its portfolio.
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Microsoft announces mass layoffs
On July 2, 2025, Microsoft announced it would lay off approximately 9,000 employees globally — about 4% of its total workforce — impacting multiple divisions, including Xbox.
On July 2, 2025, Microsoft announced it would lay off approximately 9,000 employees globally — about 4% of its total workforce — impacting multiple divisions, including Xbox.
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Xbox division hit as well
While the exact number of Xbox-related job cuts is not confirmed, the company has officially shut down several studios and cancelled multiple in-development games.
While the exact number of Xbox-related job cuts is not confirmed, the company has officially shut down several studios and cancelled multiple in-development games.
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Xbox division hit with game cancellations and studio closures
While the exact number of Xbox-related job cuts is not confirmed, the company has officially shut down several studios and cancelled multiple in-development games.
While the exact number of Xbox-related job cuts is not confirmed, the company has officially shut down several studios and cancelled multiple in-development games.
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Alpha Dog Games closed | Mobile game developer Alpha Dog Games, creators of Mighty Doom, has been closed, and all its planned mobile projects are scrapped.
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Arkane Austin closed | Arkane Austin, known for Redfall, has been shut down. Plans for future updates or DLC for Redfall have also been cancelled.
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Tango Gameworks shut down
Tango Gameworks, the studio behind Hi-Fi Rush and The Evil Within series, was also closed despite the success of its most recent title.
Tango Gameworks, the studio behind Hi-Fi Rush and The Evil Within series, was also closed despite the success of its most recent title.
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Roundhouse Games absorbed into ZeniMax Online Studios
Roundhouse Games will no longer operate independently, as its team is being merged into ZeniMax Online Studios.
Roundhouse Games will no longer operate independently, as its team is being merged into ZeniMax Online Studios.
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Multiple unannounced games cancelled
Projects that were in early development across the affected studios — including new titles from Tango Gameworks and Alpha Dog — have been cancelled as part of the restructuring.
Projects that were in early development across the affected studios — including new titles from Tango Gameworks and Alpha Dog — have been cancelled as part of the restructuring.
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