First reported by Variety
Xbox to Lay Off 3,200 Employees and Sell Four Studios in Major Restructure
Microsoft Cancels Multiple Obsidian Projects to Focus Studio on New Fallout Game, Report Says
According to a Bloomberg report by Jason Schreier, Microsoft has canceled multiple unannounced projects at Obsidian Entertainment to redirect the studio toward developing a new Fallout game. This comes amid broader turmoil at Microsoft/Xbox, including studio closures, sales, and significant layoffs — with Obsidian itself losing about a quarter of its team.
Key quotes
According to Bloomberg's Jason Schreier, Microsoft has canceled multiple Obsidian Entertainment projects to start to have the veteran RPG studio begin work on a new game in the Fallout franchise.
Obsidian was not immune to the layoffs either, with about a quarter of their team let go, per Schreier.
They recently shed four studios through sale or letting them revert back to being independent, on top of laying off 1600 employees with 1600 more planned over 2026-2027's fiscal year.
From the article
Obsidian Entertainment is returning to the Fallout universe per a report, but maybe at the expense of a few other franchises.
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