id Software Is Battered But Not Broken After Microsoft's Brutal Xbox Layoffs

A Brutal Week for the DOOM Studio

Of all the layoffs that came down on Xbox Game Studios this week as part of Microsoft and Xbox's 3,200 "reset" cuts and four studio divestments, the ones that hit DOOM developer id Software were the most shocking to many, given the popularity and success of its modern trilogy of games. The legendary studio — responsible for franchises that shaped the first-person shooter genre — found itself at the center of a firestorm of rumors, speculation, and outright panic. But as the dust begins to settle this Saturday, a clearer picture is emerging: id Software is wounded, not dead.

Well over half of id's staff was reportedly axed, with 136 developers — 96 at its Texas headquarters and an additional 40 remote workers — let go from the studio. The cuts impacted nearly every department within the developer, including the teams building, maintaining, and improving its id Tech game engine used for a variety of ZeniMax projects. To make matters worse, Microsoft confirmed the sweeping job cuts on July 6th — one day before the release of id Software's newest release, DOOM: The Dark Ages – Revelations.

Rumors Spiraled — Then Got Corrected

Key positions were cut and entire teams were decimated, according to multiple sources. Former staff were especially concerned about the fate of the studio's proprietary game engine, id Tech, after the layoff notice listed the Director of Engine Technology at id Software among those let go. That sparked one of the darkest rumors of the week: that virtually nobody remained who could properly maintain the engine. But reporter Jez Corden pushed back, claiming there is a "solid stack of expertise for id Tech, across id Software itself, and Machine Games," and that Microsoft "has no plans to shift either studio forcibly to Unreal Engine." Microsoft itself backed this up with an official statement: "There are dozens of people working on id Tech across multiple locations. Reports that there's only one person left in Texas are inaccurate."

Another rumor circulating was that id Software had shrunk to a headcount that is untenable for future self-made products, relegating them to "support studio" status. That too, according to Corden, is false — his understanding is that the remaining id Software core team is roughly the same as it was when DOOM (2016) shipped. That game is widely regarded as one of the greatest shooters ever made.

id Software Speaks for Itself

On July 10th, the official id Software account on X shared a message from the team. It began by thanking fans for their support, then quickly addressed concerns about the studio's future. The key takeaway: id Software "still have the crew [it needs] to build the games and tech" the company is known for. The studio confirmed that "the team today is about the same size we were when making DOOM (2016)" and that it would remain true to its "flat studio" philosophy — where everyone is a maker — going forward.

While rumors of id Software's demise have been greatly exaggerated, the layoffs have still been callous and brutal. Staffers with decades of expertise and tenure were let go, despite the success of the modern DOOM trilogy. DOOM co-creator John Romero was among those who responded publicly, calling it "a strange and painful thing to step away from a place that holds so much of your work, friendships and history," and acknowledging that "DOOM, Quake, and Wolfenstein are not easy names to carry on."

What Comes Next for DOOM and id Tech

The company declined to comment on any future projects the studio may be working on, though sources indicated that nothing was currently greenlit — there were pitches for multiplayer DLC for DOOM: The Dark Ages and a non-DOOM game floating around within the studio. The studio's official statement did end with a reminder that QuakeCon, Bethesda's annual gaming convention, is still taking place this August — a signal that id isn't going quietly.

Some analysts argue Microsoft should double down on id Tech rather than retreat from it. Handing even more power to Unreal Engine "opens them up to monopolistic price increases down the line," and Xbox CEO Asha Sharma herself has said she wants Microsoft to rely less on outside vendors — making the case that Microsoft should invest more in id Tech, not less. The studio that gave the world DOOM, Quake, and Wolfenstein has survived worse than a corporate restructuring before. Whether it can do so again with a leaner roster — and without the institutional knowledge that walked out the door — is the question that will define its next chapter.