A clearer picture of how hard id Software has been hit by Microsoft’s drastic Xbox restructuring is beginning to emerge, and it has been hit very hard indeed.
According to an official WARN notice filed in Texas (seen by Game Developer), 136 people working for id Software have been let go. Apparently 96 of those relate to people working at the id Software office in Texas and 40 of them are remote. This means that of the 185 people said to be working for id Software in December 2025, 49 people remain. A WARN notice is a legal requirement when making a large group of people redundant (100 people or more) in the US.
GamesBeat, in an insider report based on talking to people who worked at the company, heard how it had felt like “a bloodbath”. “I was blindsided by it. The scale of it,” one former employee told the publication.
Separately, in a post on LinkedIn, former principal VFX artist Derek Best said: “I’m still in shock at how brutal the layoff cuts were. Collectively decades of knowledge was wiped out of the studio. Great job Microsoft. Nothing says business success like nuking a team into the dirt and relegating them to support studio size while also throwing out massive technological achievements.”
GamesBeat heard that the cuts were made as id Software was experimenting with ideas about what to make next, having released Doom: The Dark Ages last year – a game that seemed to have been a big success – and expansion Revelations only this week.
One of those ideas involved a “John Wick-style” original game called Fury, apparently, which “had elements of sci-fi, noir, and Louisiana and Chicago gangsters”. It had “a modern, cyberpunk-like feel” and a gameplay concept based around “Gun Fu” – a combination of gunplay and martial arts – but it was never formally greenlit for production.
Another pitch was for a new game in the Perfect Dark franchise, which has proven a poisoned chalice after a Perfect Dark reboot – co-developed by Tomb Raider’s Crystal Dynamics and the since-closed Xbox studio The Initiative – was cancelled in 2025. There was an idea for a Westworld-inspired robot game focused on survival as well, dubbed Ironwood, and an idea for a multiplayer and co-op version of Doom. However, “No one appears to be working on Quake,” GamesBeat added. With less than 50 people remaining at id Software, the studio’s ability to make a full-scale game has gone, realistically. This leaves a question mark hanging over what the studio will do now.
Historically, id Software has – alongside its games – been known for making proprietary engine id Tech, which powers its titles and now MachineGames’ Wolfenstein series, and Indiana Jones and the Great Circle. Will it be refocused around that? Xbox boss Asha Sharma did talk about streamlining tool use across the division and cutting “vendor spend” in half, which presumably means paying for external engines like Unreal.
But if that’s the case, why fire so many people from id Software related to engine development? An unverified list of lost-positions at id Software shows many senior, engine-related positions affected, and previous reports have suggested most – if not all – coding positions have gone. And why licence Unreal Engine 5 for the remake of Halo 1, if focusing on id Tech is a priority? The answer is probably because “it’s not”.
Which leaves id Software as – as former VFX artists Derek Best suggested – an Xbox support studio, presumably to help MachineGames make a heavily rumoured new Wolfenstein game. It’s a sad end for such a decorated studio, which in the earlier days of gaming helped shape an entire industry. Indeed Eurogamer originally grew out of the Quake 2 community, to share some site-specific lore. Our office toilets were named after Quake 2 maps.
John Romero, a key person involved in creating Doom and Quake, has already offered his sympathies to those affected. We offer ours too; our thoughts are with those affected, and id Software, know that you live rent-free in our hearts.
Microsoft’s drastic restructuring of Xbox was announced earlier this week, and it will result in 3200 people losing their jobs – 1600 now, 1600 over the course of the next year – and probably five studios leaving Xbox’s roster. Double Fine and Compulsion Games are independent again; Ninja Theory and Undead Labs are under undisclosed new leadership; and Arkane is in divestment negotiations.
