Inside Xbox’s Layoffs - Is AI What’s Really Going On?
424In digging into what's really happening at Xbox, there seems to be a growing pattern: major projects canceled, studios gutted, and layoffs sweeping through some of Microsoft’s most ambitious teams. Games like Perfect Dark, Everwild, and Project Blackbird were once full of promise but now, many are shelved or stalled.
Beneath it all, there’s a quiet shift happening: AI tools are being introduced and prioritized, and some insiders believe they’re starting to replace the developers themselves. But beyond that, let's talk about the cancelled projects and where these AI statements come from?
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Sources
Bloomberg: https://www.bloomberg.com/news/newsletters/2025-07-03/microsoft-s-xbox-cancels-blackbird-an-upcoming-game-that-impressed-executives
VGC: https://www.videogameschronicle.com/news/insiders-describe-fast-and-furious-exits-from-xboxs-perfect-dark-studio
Seattle Times: https://www.seattletimes.com/business/microsoft/microsoft-to-lay-off-as-many-as-9000-employees-in-latest-round
Polygon on Everwild: https://www.polygon.com/22533819/everwild-rare-reboot-delay-xbox-series-x-pc-report
Hideo Kojima’s OD: https://www.windowscentral.com/gaming/xbox/hideo-kojimas-od-is-still-in-development-with-xbox-at-least-for-today
John Romero’s comment: https://x.com/romero/status/1940718014540009489