It’s been a dark day for Xbox and the gaming industry as a whole, as around 9100 employees have reportedly been laid off across Xbox’s ecosystem.
Earlier today, we learned about the cancellation of Everwild, an adventure game that had been in development at Rare since 2014. Now, Jason Schreier of Bloomberg is reporting that an unnanounced MMORPG project has been cancelled at Zenimax Online.
Zenimax Online, developer of The Elder Scrolls Online and Fallout 76, has been working on an unannounced MMORPG—codenamed Blackbird—since 2018. It would appear this project has now been cancelled, as Xbox scales back on active projects at its subsidiary studios.
Zenimax’s Second MMO Has Been Cancelled
BREAKING: The new MMORPG project from Zenimax Online Studios, maker of Elder Scrolls Online, has been canceled as part of the Xbox layoffs, sources tell Bloomberg News. The project, code-named Blackbird, had been in development since 2018. Still more news to come this morning.
— Jason Schreier (@jasonschreier.bsky.social) 2025-07-02T15:05:30.540Z
We knew very little about Zenimax’s in-development MMO. Information gleaned from job listings seems to suggest it was a new science-fiction IP that heavily featured vehicles, but none of this has ever been confirmed by Zenimax, Bethesda or Xbox. The only official information regarding Blackbird was an acknowledgement by Zenimax that it was recruiting for a “new game” when the aforementioned job listings were posted.
Zenimax Online continues to release updates for The Elder Scrolls Online and Fallout 76, with both having just received expansions. Seasons of the Worm Cult is the latest offering for Elder Scrolls Online, which sees the game’s original villains return to sew chaos in Tamriel. Meanwhile, Fallout 76 received a major update, entitled Gone Fission, which, as you might’ve guessed, added a fishing system into the game.
Schreier’s post suggests there are more cancellations and layoffs on the way as information continues to filter out from Xbox.
Xbox head Phil Spencer sent an internal memo to staff about the layoffs, saying “…we will end or decrease work in certain areas of the business and follow Microsoft’s lead in removing layers of management to increase agility and effectiveness.”
This is the fourth round of layoffs at Xbox since the company’s acquisition of Activision-Blizzard, a deal that cost Xbox $68 billion.
The full extent of today’s layoffs is currently unknown, but their effects are far-reaching.
- Date Founded
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May 1, 1999
- CEO
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Robert Altman