Perfect Dark canceled, studio shut down amid thousands of layoffs at Microsoft
Approximately 9,000 employees have been laid off today at Microsoft, including within the gaming division. Perfect Dark and other games have been canceled.
Today, Microsoft announced that approximately 9,000 employees will be laid off across the entire company, including an unspecified number from the gaming division, initially reported by the Seattle Times. The gaming giant has also reportedly canceled several games and closed at least one studio. The reboot of Perfect Dark has been canceled, and developer The Initiative has been shut down. An MMO from ZeniMax has also been canceled, as well as the long-in-development Everwild from Rare. This news arrives as Microsoft’s stock price hits a record high and the company reports billions of dollars in revenue.
Thousands of employees laid off, Perfect Dark canceled, studio closed, as Microsoft continues to make billions
Phil Spencer, CEO of Microsoft Gaming, sent an email to Microsoft employees today. You can read the entire lengthy email at VGC, but it’s mostly corporate speak. In the same message, Spencer acknowledges that Xbox has “more players, games, and gaming hours than ever before…” while also informing potentially thousands of people that they will be out of a job. The sentiment rings quite hollow.
This news story is rapidly evolving as more information becomes available. But there are many things we already know, thanks to coverage from Jason Schreier at Bloomberg. From several posts on BlueSky, Schreier has confirmed layoffs at several studios, including the Call of Duty studio, Raven Software, and reportedly 50% of staff at Forza Motorsport developer Turn 10. Schreier has also confirmed that a project from Elder Scrolls Online studio Zenimax Online has been canceled. This project was to be a new MMORPG code-named Blackbird that had been in development since 2018.
Head of Xbox Game Studios, Matt Booty, confirmed the closure of The Initiative, the studio working on the upcoming reboot of Perfect Dark, which was showcased at 2024’s Xbox Summer Showcase. In a statement, Booty said that the decisions “reflect a broader effort to adjust priorities and focus resources to set up our teams for greater success within a changing industry landscape.”
In a report by CNBC, pointed out on BlueSky by Game File’s Stephen Totilo, “Microsoft reported nearly $26 billion in net income on $70 billion in revenue for the March quarter... keeping Microsoft ranked as one of the most profitable companies in the S&P 500 index…” Also, “Microsoft stock closed at a record high of $497.45 per share on June 26,” just six days ago. Why does a company that appears to be doing so well financially still feel the need to upend the lives of thousands of employees?
This is the largest number of layoffs from Microsoft since 2023, but that doesn’t mean they are the only ones. In January 2023, approximately 10,000 employees were laid off, including employees at Bethesda and 343 Industries. Then, in January 2024, 1,900 employees were confirmed to be laid off across Activision Blizzard, Bethesda, and Xbox, just a few months after the acquisition of Activision Blizzard was finalized. More layoffs were announced in September 2024, as well as earlier this year.
This is not a sustainable way to create video games. Today, thousands of people must now scramble to figure out their next steps. They might need to leave their home, uprooting their family and community, to take on a new job elsewhere. Many will likely never return to video games, simply due to a lack of opportunities, job insecurity, or simple exhaustion. We could be missing out on many great developers and games that will never be made now.
I hope for the best for everyone affected by this catastrophic news. I hope they find a job elsewhere that treats them with respect and provides the stability and security they need. The video game industry can do better for the workers who make its amazing games. Employees at Blizzard have already begun forming unions, and hopefully, this inspires more video game developers to do the same.
