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Leaked Xbox Memo Reveals Obsidian’s Fate Under Bethesda

Source: Elijah Gonzalez · Published Sep 23, 2026, 8:59 PM

Leaked Xbox Memo Reveals Obsidian’s Fate Under Bethesda

In early July, the company announced it would lay off 1,600 employees and divest from several of its acclaimed studios , including Double Fine, with more layoffs expected in the coming fiscal year. On Sept. 22, Microsoft finally announced that next wave of job cuts , affecting an additional 268 developers.

The layoffs coincided with a major company-wide reorganization that will merge several studios, resulting in big changes like Halo being moved under Activision.

In Gaming, Elijah Gonzalez puts this story at the center of the day: In early July, the company announced it would lay off 1,600 employees and divest from several of its acclaimed studios , including Double Fine, with more layoffs expected in the coming fiscal year. On Sept. 22, Microsoft finally announced that next wave of job cuts , affecting an additional 268 developers. FlexChar is surfacing it because it is driving searches and conversation right now.

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