Elder Scrolls Online studio reportedly loses up to half its team in Xbox layoffs

ZeniMax Online Studios, the developer behind The Elder Scrolls Online, has been devastated by this week's Xbox layoffs, with sources telling Kotaku that as many as half of the studio's employees may have been let go. The cuts have thrown the future of the long-running MMO into serious doubt, with the game's roadmap now confirmed to be in flux.

The details:

• Multiple sources within ZeniMax Online told Kotaku that the total number of people impacted could be as much as half the development team, with workers called into group HR meetings where they were laid off alongside colleagues.
• Over 20 individuals had already posted about being laid off on LinkedIn by the time Kotaku published, many with tenures of over a decade at the studio.
• Official WARN notices confirm 213 people were laid off at ZeniMax Online, with the cuts taking effect September 4, 2026.
• ESO community manager Jessica Folsom posted on the game's forums to "reaffirm our commitment" to the game, but confirmed that "the roadmaps we previously shared will be shifting" while the reduced team evaluates what remains and sets a new schedule.
• An internal email sent to Bethesda and ZeniMax employees said the restructuring is aimed at improving long-term growth, with Bethesda's focus going forward narrowing to its biggest franchises: Fallout, The Elder Scrolls, Wolfenstein, Doom, and Quake.
• ESO has been live since 2014, has been played by 24 million people, generated over $2 billion in revenue, and was reportedly bringing in around $15 million per month as of 2024.
• This is not the first time ZeniMax Online has been hit hard. Last year's layoff round resulted in the cancellation of internal project "Project Blackbird." The studio has since formed two CWA-affiliated unions, one for QA and one for the broader team.