Xbox's 1,600 layoffs last week were brutal on the developers impacted, and will have uncertain ripples on the industry for years to come—however, a recent report from Game Developer states that the "reset" itself was chaotically implemented.
Speaking with multiple sources, the report shares that employees across Xbox were "informed their jobs were being eliminated during a fleeting video call with management at their respective studios … Chat was disabled. Microphones were permanently muted. In one instance, cameras were automatically turned off—meaning those delivering the news couldn't even see their colleagues' faces."
One source told Game Developer that the call regarding id Software, where over 130 people were laid off, "lasted under 60 seconds," with an additional ask for ousted developers not to come into the office despite the fact that many had already begun commuting.
"Once the news had been delivered, Slack and internal email access was reportedly pulled within 48 hours," Game Developer states. "It left colleagues scrambling to make sense of the situation using unofficial channels—many of which are overseen by union members and organizers."
"Many of us did not know what was happening for weeks," one developer told the site. "Higher ups didn't know or did not say. It was left to all of us to speculate and spiral and worry." Another source from id Software added: "Does Microsoft care? Absolutely not. And they seem to actually put some level of effort and care into making it as painful as possible."
There's also the hanging sword of Damocles that is the additional 1,600 layoffs, which Xbox CEO Asha Sharma said would be happening before 2027. This looming aftershock has understandably been disastrous for morale. Another developer tells Game Developer that they "don’t know how anyone remaining at Xbox studios can feel safe knowing another 1600 cuts are coming.
"And even then, what happens after June 2027? Will we get layoffs in July for the third year in a row?"
I'd honestly be asking myself the same thing—mind, I'm not a CEO responsible for 'returning to growth' or what-have-you, but given the year of shame Microsoft had in 2025, I can't help but ponder if it was the best thing for morale to promise that another 1600 jobs would be lost at some point by 2027.
Point being, people who are waiting for the other shoe to drop aren't usually able to do good work, or might reasonably be looking for new work (not that that's easy, right now). That doesn't, to me, seem like a helpful environment in which to get 1 billion daily players.
