Xbox Game Studios Head confirms 40+ Xbox games still in development amid Microsoft layoffs
A sweeping round of layoffs took place at Microsoft earlier this week in a decision to let go of 9,100 employees or nearly 4% of the company’s workforce across multiple divisions. Microsoft’s Xbox division was one of the hardest hit as a result of these.
Despite this, Xbox Game Studios confirmed more than 40 games are still in active development. This report came directly from an internal email by Matt Booty, the head of Xbox Game Studios. Booty affirms that the company’s core strategy, building games that excite players and growing its biggest franchises, is still its top priority.
The layoffs resulted in the cancellation of the Perfect Dark reboot and the closure of its studio, The Initiative. Moreover, Rare’s IP, Everwild, had been in development for almost a decade and even received an official trailer back in July 2020, but has now been cancelled. As a result, Rare’s long-time director and executive producer for Everwild left the studio after 35 years.
The studio responsible for Forza Motorsport, Turn 10, reportedly lost 50 percent of its staff during the layoffs. Rumors circulated that Xbox CEO Phil Spencer might also be joining the departure list, but Microsoft insists he won't be retiring “anytime soon.”
An unannounced Zenimax Online Studios project was also shelved during the restructuring, which was followed by the departure of the studio head, Matt Firor, who had been with the company for 18 years.
But Booty’s message was clear. The majority of Xbox’s game portfolio stays, and the company is “continuing momentum on titles shipping this fall, and a strong slate headed into 2026.”
This means that every game recently shown at the Summer Game Fest and Xbox Games Showcase is still in development. Notable titles include Clockwork: Revolution, Call of Duty: Black Ops 7, and State of Decay 3. In addition, active games nearing release include: The Outer Worlds 2, slated for October 29, High on Life 2 for Winter 2025, Ninja Gaiden 4 for October 21, Grounded 2 for July 29, and Gears of War Reloaded for August 26, 2025.
These layoffs have quite understandably left many industry watchers and developers uncertain about the future of Xbox and gaming. Yet, Microsoft’s leadership insists that these layoffs are part of a broader effort to “adjust priorities and focus resources to set up our teams for greater success within a changing industry landscape.”
