Xbox’s Elder Scrolls VI strategy looks unclear after layoffs hit Bethesda Game Studios

Xbox’s latest layoffs have created new doubts around one of Microsoft’s most important upcoming games, The Elder Scrolls VI. The company has reportedly been shifting toward a franchise first strategy, with more attention on major brands such as The Elder Scrolls, Fallout, Halo, DOOM, and Wolfenstein. But that plan now looks harder to understand after the studios behind several of those franchises were hit by deep cuts.

The Elder Scrolls VI should be one of Xbox’s safest long term bets. Skyrim remains one of the most successful RPGs ever released, with more than 60 million copies sold as of June 2023. Since the next mainline Elder Scrolls game is still believed to be years away, many expected Microsoft to protect or strengthen Bethesda Game Studios rather than reduce its workforce.

Instead, the Bethesda Game Studios union said the latest layoffs affected many people across key development roles. According to the union, the cuts were not simply a reduction of management layers. Programmers, artists, designers, and testers were among those affected, including staff who had worked at Bethesda for decades.

Cutting core development teams makes Xbox’s franchise first plan harder to read

The contradiction is the main concern. If Xbox wants to rely more heavily on its biggest franchises, then The Elder Scrolls VI should logically receive more support, not less. The game is already carrying huge expectations, and Bethesda’s recent output has made quality control, technical polish, and development leadership even more important.

The issue becomes more serious because The Elder Scrolls VI is not believed to be close to release. If the game is still two to three years away, the team will need stable staffing through some of the most important phases of development. Large RPGs depend on many connected systems, including world design, quest structure, combat, tools, animation, performance work, testing, and bug fixing. Losing experienced staff during that process can create delays or force compromises.

The situation at id Software adds to the wider concern. The DOOM studio was also reportedly hit hard, including losses among technical staff tied to its proprietary engine work. If Xbox is cutting deeply into teams behind its strongest internal brands, it raises questions about how the company plans to deliver faster, larger, and more polished franchise releases.

From a business angle, Microsoft may be trying to reduce costs after years of heavy spending and uneven growth from Game Pass. But creative production does not respond instantly to corporate restructuring. Cutting people from teams working on complex games can save money in the short term while creating longer term risks for development schedules and final quality.

The Elder Scrolls VI is especially sensitive because fans have waited so long. Bethesda announced the game years ago, but the gap since Skyrim has continued to grow. A rushed or understaffed release would carry major reputational risk, not only for Bethesda, but also for Xbox’s broader first party strategy.

There may still be ways for Microsoft to stabilize the project. The company could move staff internally, hire selectively, rely on external support teams, or adjust timelines to give Bethesda more room. But those solutions are not simple replacements for veteran developers who understand the studio’s tools, workflows, and design style.

For now, the message around The Elder Scrolls VI feels mixed. Xbox says its future depends on major franchises, yet Bethesda Game Studios has still taken meaningful cuts. If Microsoft wants The Elder Scrolls VI to become the kind of flagship release its strategy demands, it will need to show that the game has the people, time, and support required to meet expectations.