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Bethesda Shifts Focus Amid Xbox Layoffs

WireByte Staff · July 6, 2026

Microsoft's Xbox is undergoing significant restructuring, with 3,200 layoffs announced, including 1,600 today. Bethesda, a major Xbox developer, is particularly affected, with staff facing uncertainty. The company's boss, Jill Braff, says they must focus on strongest franchises to ensure sustainable growth.

Key points

  • Microsoft's Xbox is laying off 3,200 staff, with 1,600 cuts happening today, as part of the most significant restructure in Xbox history.
  • Bethesda, a major Xbox developer, is hit hard by the layoffs, with staff facing uncertainty across its development studios.
  • Bethesda boss Jill Braff says the company must focus on its strongest franchises to ensure sustainable growth and investment in its players.
  • The layoffs reflect Microsoft's gaming business being 'not healthy', according to Xbox CEO Asha Sharma.
  • Bethesda is shifting its strategy to strengthen its business and return to sustainable growth, following the layoffs.

Microsoft's Xbox is undergoing significant restructuring, with 3,200 layoffs announced. The cuts, including 1,600 today, are part of the most significant restructure in Xbox history, according to Xbox CEO Asha Sharma. The layoffs are affecting major Xbox developers, including Bethesda, which is hit particularly hard. Bethesda's boss, Jill Braff, has told staff that the company must focus on its strongest franchises to ensure sustainable growth and investment in its players. This shift in strategy follows the layoffs, which reflect Microsoft's gaming business being 'not healthy', according to Sharma. The future of Bethesda's development studios is uncertain, with staff facing an uncertain future. The company's goal is to strengthen its business and return to sustainable growth.

Sources

WireByte Staff — Editorial Team

The WireByte editorial team synthesises technology news from multiple primary sources, verifies the facts, and links every source. Articles are produced with AI assistance and reviewed under our editorial policy.