id Software's Future in Doubt After Xbox Cuts Leave DOOM Maker a Shell of Its Former Self

The latest wave of Microsoft gaming layoffs has landed with devastating force on id Software, the legendary developer behind the DOOM franchise, with 136 employees cut in what insiders are calling a gutting of the studio's creative core. While Microsoft avoided outright closing studios — a move that might have drawn even sharper public criticism — the scale of cuts at individual teams is beginning to tell a grimmer story about the health of its gaming division. For id Software, a studio with one of the most storied legacies in first-person shooter history, the damage appears severe and potentially lasting.

According to a detailed behind-the-scenes report from Gamesbeat, at least one former staff member stated bluntly that they are 'not convinced there's a viable path forward' for the studio following the cuts. Ex-VFX artist Derek Best went further, publicly condemning Microsoft's decision-making in scathing terms, accusing the company of 'nuking a team into the dirt' and relegating it to the functional size of a support studio. These are not anonymous grumblings — these are professionals with direct insight into id Software's internal culture and capabilities speaking out with unusual candor.

The layoffs arrive at a particularly painful moment for id Software, which had reportedly been developing ambitious new projects in the wake of completing DOOM: The Dark Ages' DLC pipeline. Internal plans allegedly included a John Wick-inspired gun-fu action game and a contribution to the long-troubled Perfect Dark revival. Whether any of those projects survive the cuts, or whether the studio even retains enough staff to pursue original work at scale, is now an open question with no clear answer.

A thread running through the Gamesbeat reporting is a sense of institutional betrayal — that id Software followed Microsoft's mandates faithfully, building DOOM: The Dark Ages as a premium single-player experience, only to watch full-price revenue get absorbed into Xbox Game Pass subscriptions. There is a growing sentiment within the team that incorporating multiplayer or live service elements might have generated the sustained income stream that could have protected jobs. It is worth noting that The Dark Ages launched simultaneously on PS5 and PC at full price, meaning some direct sales revenue did flow in — but apparently not enough to shield the studio from the axe.

Former staffers, per Gamesbeat's reporting, had hoped Microsoft might spin id Software off or sell it outright, following the model used for Double Fine and Compulsion Games, rather than executing deep internal cuts. Instead, the studio now faces the challenge of rebuilding its identity — and its headcount — in an environment where Microsoft's broader strategy for its gaming division remains opaque. With Obsidian reportedly being assigned Fallout and other studios being reshuffled, the picture forming is one of a platform holder repurposing its teams rather than nurturing them.