Overview
- Reports this week say Obsidian Entertainment cut roughly 25% of its workforce as part of Xbox’s wider restructuring that will ultimately remove about 3,200 jobs across the division.
- Bloomberg-based reporting indicates Obsidian has been reassigned to develop a new Fallout game with studio design director Josh Sawyer reported to lead the project and Bethesda expected to collaborate in some capacity.
- The shift forced the cancellation or deprioritization of several internal projects, including a planned Avowed sequel, though a small team is said to continue limited work on that title while others support The Outer Worlds 2 DLC and Grounded 2.
- Published accounts give differing numerical tallies for the cuts — reports list figures from about 52 employees to as many as 60–70 — underlining that headcount details and precise project scopes remain in flux and unconfirmed by Xbox.
- Industry sources warn the changes will slow or reshape longer-term timelines, damage studio morale, and concentrate Xbox’s creative output on established IP as leadership seeks quicker returns and clearer franchise roadmaps.