Gamer Chronicles

Pixel Carnage: Xbox’s Summer Massacre

• Aden • Episode 14

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In this brutally honest (and unfiltered) episode of Gamer Chronicles, we dive headfirst into the July 2025 Microsoft Xbox layoffs — a corporate shitshow that left thousands of developers jobless, fan-favorite games cancelled, and the future of Xbox murkier than a Fallout vault.

We’re talking:

  • 🔥 9,000+ layoffs across Microsoft, with Xbox absolutely gutted
  • 💀 Studios shut down (RIP The Initiative, Romero Games funding)
  • 🎮 Cancelled games (Perfect Dark, Everwild, and more — gone forever)
  • 🧠 Microsoft’s “strategic realignment” (translation: bullshit corporate spin)
  • 💣 Fallout from fans, devs, and Phil Spencer’s awkward Sad Dad memo
  • 🌍 How the entire gaming industry is on fire (EA, Sony, Embracer, Unity — you name it, they’re laying off)
  • 🎯 What this all means for the future of Xbox, Game Pass, and gaming in general

Expect sarcasm. Expect profanity. Expect truth bombs.
 Because we’re not pulling punches — we’re calling out the bastards.

🎧 Listen If You Love:

  • Gaming news with zero corporate fluff
  • Calling out industry arseholes
  • Raging at the loss of good games
  • Actual transparency and humor in gaming podcasts
  • Xbox, but you’re mad at it right now

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0:00
Hey there, legends, and welcome back to Gamer Chronicles, where pixels tell stories and corporate bastards ruin dreams. Today's episode is a spicy one, so grab your controller, pour something stiff, and let's talk about how Microsoft absolutely detonated their Xbox division in July 2025. Yup, the mass layoff, the cancel games, the shuttered studios, and the entire career dreams bulldozed in the name of strategic realignment. Because when the higher-ups say that they're streamlining for long-term success, what they really mean is we're firing half the dev team so the shareholders don't have a nervous breakdown. And we're gonna call this episode Pixel Carnage Xbox's Summer Massacre because holy shit, Microsoft went full scorched earth. So, this episode we're gonna take a deep dive into exactly what studios and develops Get the Axe, the heartbeat of cancelled games like Everwild and Perfect Dark, Phil Spencer's corporate kumbaya memo that read like a breakup text, and why 2025 is officially the year of the layoff for the gaming industry. Stick around, it's gonna be raw, real, and yep, there will be a few well-earned F-bombs. 

So, welcome to this episode, everyone. This is a bit of a different approach because, well, I have been playing quite a lot of games. And this time, I can blame one of my friends for this episode being late because, as you know... I feel the pain of these people who are being laid off because it happened to me recently. But one of my mates, who actually does have a job, keeps skipping work to play Helldivers with me. So, that is what I've been done. Pretty much for the last two weeks, I'm playing Helldivers from till afternoon where then I have to go pick up the kids. And, yeah, I can't say I regret it. Definitely not. But anyway, I digress. it's a bit of month for a lot of people, unfortunately. 


 ------ What the Hell Happened at Xbox? ------  2:25

2:25
So, let's look at what the hell has happened at Xbox, or, in this case, Microsoft. So, let's rewind to early July of this year. It's a sunny week. Birds are chirping. Gamers are still buzzing from the Xbox showcase a few weeks earlier. And then, Microsoft just rams their fists down our throats and yeets 9,000 people out of their jobs. And what's the kicker about this is half of are part of the Xbox gaming division. And it wasn't a single clean announcement, no classy press release. The news trickled out like a leaky toilet with studios confirming closures on Twitter. Devs posting shock goodbyes on LinkedIn and fans collectively screaming, What? What the fuck has just happened? And the official PR spin was restructuring to position teams for enduring success in a dynamic marketplace. Even corporations have to realize when they're writing this translation of this is we're cutting beloved games and laying thousands of devs Because some fucker in finance wants a bigger quarterly bonus. And it wasn't just support staff. They went for the jugular. First party studios, long running IPs, even teams working on announced games. And here's how it went down. Entire studios closed. Years of long projects. Canned mid-development. Veteran developers with decades that Xbox just fucked off like yesterday's patch notes. And internal teams like user research and Q&A sliced in half like a poorly timed katana swing in Ghost of Tsushima. This wasn't just trimming fat. This was a corporate bloodbath dressed up in HR speak. And while Microsoft tried to downplay the scale, insiders quickly spilled the beans. Over 50% of some studios gone. Whole projects vanished into the ether and fans losing their minds watching it all unfold. The result is Xbox Feature suddenly looked a lot emptier. thing if you're going to lay off so many people, there will be a lot of leaks. And what they've done... This is so fucking Microsoft to do something like this. So in their IT division, they've obviously laid off a lot of people. But they've gotten a lot of foreign people to come on work visas to replace those other people. Because it's a lot cheaper. And, you know, the people on visas aren't going to really do anything because their job relies on that visa. So not only has Microsoft said, okay, well, your job is no longer required. Wait a second. We're going to replace you with all these other people from other countries because it's cheaper labor. I don't know how they get away with this kind of thing. This is just disgusting anyway. 


 ------ Studio Slaughter: Who Got Hit ------  5:08

5:08
Let's talk the studio slaughter and who got hit. Or should I say, parted ways with the interest of strategic alignment. So here's a quick roll of the bodies. The initiative, dead. This was supposed to be quadruple A studio. Yeah, that's right 4 A's. They were working on a big budget Perfect Dark reboot, years in the making, studio hen hunted top talents from Crystal Dynamics, Naughty Dog, you name it. And then Microsoft shuts the whole thing down like it was a bad Tinder date. Perfect Dark is now permanently unfinished, 50 devs out the door, and all that hype flushed down the toilet. Just imagine being the poor guy animating Joanna's Dark Pistol Reload when the email dropped, "Hi, you're fired. Also, the game's dead. Also, we cancelled lunch. Now pack your stuff and fuck off." Next in the firing line was Turn 10 Studios who suffered massive cuts. And these are the Petroherds behind Forza Motorsport. Now, Forza Motorsport is officially dead as of now. Not Horizon, but there will apparently not be another Forza Motorsport game. There will be another Horizon game, but Forza Motorsport is now dead. You'd think one of Xbox's only reliable franchises would be Turn 10 got slashed in half, and 50% of their staff gone. And apparently Microsoft wants Forza to do more with less. And that translates to "Hope you guys like recycled car models and half-baked career modes, because we just fired the physics guy." This one hurts, because everyone will know this name. Rare. the makers of Banjo-Kazooie, GoldenEye, and Sea of Thieves, they were working on a beautiful, mysterious new IP called Everwild. Well, scratch that: they were, because Everwild got axed as well, so hard that it probably felt it in the afterlife. Rare's creative director, 35 years of the company, walked out. Well, I say walked. He was definitely pushed out.And  that ship is sinking. ZeniMax Online Studios was next, with the project cancelled and their boss quit. The guys who made Elder Scrolls Online were working on a new MMORPG, codenamed Blackbird, 7 years in development with a huge team and poof! It's gone. It's a bit like the South Park episode. And it's gone. To top it off, the studio president stepped down. Huh. I mean... Oh... Yeah, can't really blame him. Just be like, fuck it, I'm out of here. Xbox user research is now gone, apparently. Microsoft decided they didn't need people to test the games anymore, because who the fuck needs user feedback? It's not like the games releasing today are absolutely perfect and have no bugs. Oh wait! Almost every AAA game that releases now is shit. Until they fix it. Look at, um... What was it called? That... Mind... Whatever game? The one that was supposed to... I can't even remember it was so shit. Uh, the one that was supposed to mimic Grand Theft Auto. Mind's Eye, that's it. And, yep. You know... Cyberpunk 2077, when that came out. Now for some... Honourable mentions. Romero Games. They lost their Xbox Publishing deal. I don't... Do they just not have any contract with them? Like, can Microsoft just pull out? This is so bad. Their project's dead. Studio hanging on by a thread, obviously. King, the makers of Candy Crush, had a 10% layoff. Even the billionaires aren't safe. And the 343 Industries, another famous one, they had small cuts. This is still kicking Master Chief in his chutneys. But we're not done yet. Because, while those were the studios, there is a whole list of cancelled games. 


 ------ Cancelled Games ------  8:52

8:52
These are the games we were actually excited about. The ones that got brutally cancelled in the Microsoft Purge. They didn't just kill Vaporware. They killed shit we'd already seen trailers for. The shit that made us scream, "We will give you our money, Microsoft". And Microsoft just went, "Nah. Fuck off. Fist yourself. And let's go down the list of dreams murdered in cold blood". So of course, we mentioned it. Ever Wild by Rare, the beautiful magical game that died screaming. This was Rare's big comeback announced in 2019 with the gorgeous studio... Gilblee meets Fantasy Forest art style. No one knew what the gameplay was, but... Damn was it pretty. It Mystical deer. It had glowy spirits. It had... "Please give me this now energy". And now... Canceled fucked gone. Microsoft pulled the plug in July 2025 and left fans wondering... Why even tease us for six goddamn years? And here's a fun fact. Development was such a mess that Rare rebooted it internally in 2021. So it was already limping. And Microsoft just came in... Shot it to put it out of its misery. Just like they did Old Yeller. Now, as I said, they killed this studio who made Perfect Dark. Remember that Perfect Dark reboot trailer from 2020? Joanna Dark back in action, cyberpunk vibes, espionage thriller, looked like Xbox was finally reviving a classic IP with love and style? Well, ha. Nope. Because again, they nuked the entire fucking studio, making it the initiative gone, Perfect Dark gone. And all we got was a teaser trailer and the sounds of 50 devs screaming into the void. Imagine working on something for five years, seeing it on stage at a showcase, bearing in they said that this game is coming at a showcase. And then they said, well, you know what? Fuck off, you bastards. Get out, pack your shit, you're done. Project Blackbird. ZeniMax, the MMO that was murdered quietly. And this one, not a lot of people knew about. It did fly under the radar, but they did make Elder Scrolls Online, which has actually been quite successful. Not my cup of tea, I've tried it before, but, you know, other people love it. And they were cooking up a new one, which gave Mass Effect vibes, dialogue trees, multiplayer adventure. And it was in development for seven fucking years. It had hundreds of devs. And Phil Spencer was apparently obsessed with it. And then in July, done. Gone. And Matt Feroar, pardon the pronunciation, don't know if that's how you pronounce it, the studio boss, well, he left too, probably because he screamed into a keyboard and did a desk flip. it's a bit like baking a cake for seven years and just throwing it out because some arsehole in accounting said the frosting was off-brand. The Untitled SPS by Romero Games. John Romero definitely deserved better. And this one did hurt Romero Games. And then we're talking about that Romero. Had a first-person shooter in the works. Xbox was going to publish it. It was early days, but there was a real hype building. And then, of course, July hits and boom. Microsoft's pill funding. The project's and Romero Games is now scrambling to survive. is the gaming equivalent of proposing to someone and then ghosting them on the wedding day. Remember, Romero deserved better. I the guy made Doom, for fuck's sake. He literally made FPSs what they are today. Without him, they wouldn't be what they are. And Microsoft has the audacity to fuck someone like that. Well, after this, I might just cancel my Game Pass subscription. This is such bullshit. Anyway, other casualties. Warcraft Rumble. Support cut. Mobile team gusted. Updates canceled. Blizzard pretending it never existed. Obviously, Microsoft owns Blizzard Activision. Oh, why don't they just cut the COD team? Why don't they do that for a internal Xbox, physical game publishing, dead. Apparently, discs are for peasants now. And these aren't just lost games. They're lost jobs, stories worlds will never get to explore. Microsoft didn't just tighten the portfolio. They lobotomized it with a spiked baseball bat. 


 ------ Microsofts "Strategic Realignment" ------  13:12

13:12
Now, you might be questioning, why did Xbox do all of this? Well, let me tell you. But it involves money, of course. AI and some absolutely elite level corporate bullshit. So here we go with Microsoft strategic realignment. The corporate bullshit bingo. So now for the million dollar question, or in this case, probably a billion. Why did Microsoft go full Chainsaw Man on Xbox? Could it have been a financial emergency? The console war heating up? Game Pass bleeding money? You would think it would be one of those things, wouldn't you? But gamers, despite what people say, we are loyal to brands. I mean, look at Call of Duty, for fuck's sake. That thing should have died 10 years ago. Fortnite is a free game. And yet it does financially great because people buy skins and things that don't make the any easier for someone. So you make a good game, we give you money. That's how it works. You know, Game Pass is nice to have. anyway, so was it any of these three things? Nope. According to Microsoft, this was all part of a strategic realignment to position Xbox for enduring success in a dynamic marketplace. Oh. That's what I think of that. Anyway, I'm actually going to keep that in there. This is PR speak for we had too many teams doing cool shit that didn't immediately print money. So we axed them. let's look into some of this bullshit bingo. So we're prioritizing our strongest opportunities. Translation, if your game isn't Minecraft Call of Duty or making Phil Spencer horny, it's cancelled. Apparently, Strongest Opportunities means safe bets, Gears of War, Forza, Call of Explosions and Capitalism edition. And when I say Forza, I mean Forza Horizons now. But that weird forest game about magic animals and bonding with the earth? Cancelled. There was one they made, Ori and the Will of the Wisps, great great game. Uh, Hollow Knight, similar, obviously they didn't make that, but Hollow Knight, similar kind of vibe And they did But it didn't fit on the ROI spreadsheet cooked up by some suit who never ever touched a controller. Where they went and said, we're increasing agility and effectiveness by removing layers of management. I've been in the company that's done that one and used that exact We just fired your boss. Your boss's boss, your HR rep, and now you. This was part of Microsoft's company-wide slimming spree. Every division, gaming, surface, Azure AI, the janitor team, all got shaved down. The result was fewer cooks in the kitchen. But also, no one left to cook the fucking meal. Projects without producers, studios without leads, some poor intern probably got told to finish Fable solo, using PowerPoint. And then they have the balls to say, we'll protect what's thriving. Which means congratulations to Game Pass, Halo, and anything that sells microtransactions, the rest of you, best of Xbox is clinging to a few golden geese while yeeting everyone else off a cliff. They're not trying to nurture new ideas. They're going all in on the safe stuff. Think less innovation, more live service with premium battle passes and limited XP boost if you pre-order the Deluxe Fuck Me Edition. So basically, they're turning into EA games. Is what they're doing. Obviously, they already had Activision, so they're going to be the worst company. Now, they're going to overtake EA games in this. Next thing Microsoft said was, we're investing in AI and the future of the cloud. And this is great. Blame AI for everything. Turns out, while Xbox was bleeding out, Microsoft was over here throwing billions at AI partnerships. Azure this, co-pilot that. Let me tell you, co-pilot is shit. It is the worst AI of them all that I've It is horrendously bad. And the insides are whispering that some of the Xbox budgets got slashed to feed the AI beast. So your favorite game might have been cancelled so Clippy could become sentient. So yeah, we're basically funding AI. going to crash. It has to crash now. if everyone takes the focus off all of this, where's the money going to come from? I understand that AI is big now, but NVIDIA has moved to AI. So that means gamers might stop buying their GPUs. Microsoft is investing all it's got in AI. I mean, it might work out. You don't know. But let's see. The next thing Microsoft says, we have more players and games than ever. And that's one of memos. And honestly, what the fuck, Phil? You don't tell your team, we're doing great. And then fuck off. All you 9,000 in the same breath. That's exactly what happened many years ago when I was working at another company. I didn't get the exact... But some other people did, unfortunately. And they said the exact same line. Doing great. Now, get the fuck out of here. And that's like saying, we're crushing it. Sales are up and everyone loves us. Anyway. Fuck off. You're all fired. Phil's memo was a masterclass in passive-aggressive optimism. I wonder if he used AI to generate that memo. Wouldn't that be funny? You invest all these billions just to generate the... You're fired memo. It's a bit like telling your child, I'm proud of you. Now we're moving you to another family. So yeah, Microsoft Strategic Realignment. It's a mix of corporate bullshit, shareholder panic, cleaning house for AI. And maybe, just maybe, we have no fucking idea what we're doing. 


 ------ Fallout, Rage and Memo Damage ------  18:28

18:28
So let's talk Fallout. What happens after you lay off thousands of developers, cancel fan-favorite games, and implode half your game studios? Well, you piss off your fans, your devs, the media, and probably your own dogs. And that's exactly what happened. The fan-raged gamers lost their collective shit, and rightfully so. You cancel Perfect Dark, a beloved franchise that's been dormant for 15 years. You kill Everwild after teasing it for 6 years. You spend a decade hyping up Xbox's new golden age. And then cancel every new IP that isn't Gun, Shoot, Bang, Boom. You literally your Game Pass the changer in games. And you think people are going to stick by you in this. That people will still pay for Game Pass. I gamers are not like other people. You piss gamers off, and they collate together to basically say... Fuck Microsoft, we're gonna boycott you and... it's a lot of money. And yeah, people were not happy, the Reddit threads were on fire, Twitter was a bloodbath, or should I call it YouTube had a thousand thumbnails with "What the fuck, Xbox in Comic Sans", and one dude literally posted a 28 reaction video titled, "Xbox just cancelled my childhood and my faith in humanity, and I thought that in my soul." And now for Phil Spencer's please-don't-hate-us memo. Before this, I did respect Phil Spencer, you know, he did a lot of good for Xbox, but he's a cunt now. And his post-layoff memo was, let's like getting broken up by someone saying, "It's not you, it's our long-term market focus." Some highlights, these changes come at a time when we have more players, more games, and more gaming hours than ever before. Cool, Phil. So why the fuck are we firing half the developers? Well, we must make tough choices now for continued success. Translation is, we fucked up managing this empire of studios, and now, we're panic-slimming like a crash diet before E3. We will protect what's thriving, and concentrate on the areas with the greatest potential. So, Game Pass, Call of Duty, and Minecraft got it. Enjoy the same three games for the next three decades. And can you imagine the morale? Like you survive the layoff, and you're sitting at your desk watching your Slack channels go dark, your team vanish, your leads quit, and now you have to pick up the pieces? It's not focus. It's just a fucking shit show. A source inside rare said morale was the worst it's ever been, and this is a sadder studio that survived the Kinnect. Multiple former devs on LinkedIn called the process "brutal, callous, and straight-up corporate arseholery." "So, not the best of vibes, to be fair."


 ------ Other Cuts ------  21:35

21:35
that's not to say that Microsoft is the only bad guy. Yes, Microsoft are part of it, they're not the only ones swinging the axe this year. Let's check the carnage. In 2025, EA had over 300 layoffs, including 100 from Respawn. They a Titanfall project and a Star Wars game because, apparently, they hate joy. The Embracer group laid off 8,000 people over the last two years, shut down studios like Volition sold off IPs like they were at a garage and that's because a $2 billion deal fell through and they bought every studio like a drunk dude on Steam during a sale. Funny enough, this was mentioned in one of the other episodes in the news. Oh, yes, and who's next? Sony Playstation. Around 900 people let go. Bungie slashed 8% of their staff. The Last of Us multiplayer is basically dead. Epic Games. Despite Fortnite printing v-buck gold. 800 people. But, fuck off. Turns out that even when you're the best farm on the Metaverse, no one asks for you. You gotta cut corners. Somewhere. And this is when I say gamers. When they get pissed off. Unfortunately, this was the outcome of it. Unity. They laid off 1,800 people and tried to charge developers per like toll booths for creativity. They triggered a developer uprising that made Reddit look like a revolution. So, Microsoft Massacre is part of a larger industry-wide bloodbath. Now, obviously a lot of this was because of the pandemic boom with where a lot of people overhired. And now they're trying to overcorrect like lunatics in Mario Kart on Rainbow Road. But that's just part of it. You know, you've got, obviously you've got inflation and rising development costs, but there are hard games out there that look so And they're done by one person. Schedule One, okay? It definitely doesn't look the greatest. But it's such a good game. Such a good game. One person developed that fucking game. RimWorld, which was developed many years ago. Such a good game. Developed by one person again. Prison Architect, many years ago, developed by two people. And now Prison Architect 2 has been delayed so many times because the studio wanted to bring it into 3D. Make it, there's no need. To have, yes, it's nice to get a huge budget game like, you know, a God of War game or a Last of Us game. It is great. But gamers love even crappy pixelated looking ones because they just give us so much joy and so many hours. I spent 300 hours playing Prison Architect. I spent the same amount of time playing RimWorld. I still don't understand how fucking RimWorld works, but I still love the game. It's very complicated. Schedule I'm just waiting for one more, for another update before I take it up again, because it's such a good game. Yet, you're telling me that these people spent billions of pounds on these games. Fuck, did they not? You know, these are just people with great who made something happen. And you'd think that a company like Microsoft could do the same. But of course, AI eats budgets, too many games, not enough time, all these excuses, and of course, thousands of overpaid executives and shareholders. Again, greedy fucking bastards. 


 ------ Xbox's Future ------  24:49

24:49
So where does this leave Xbox? Honestly, somewhere between a reboot and a rehab stint. They've still got, avowed, The Outer Worlds 2, Gears of War Reloaded, Call of Duty, Infinite Capitalism, Obsidian being their last good studio with a soul. And of Game Pass is still a powerhouse. For now. And there's a hole now, a creative hole, because you can't build a gaming empire on Forza, Cod, and Vibes. You need passion products, you need weird stuff, you need kind of games that don't make sense in a boardroom, but make gamers fall in love. And right now, Xbox just axed most of those. So what will we expect? More safe games. And by safe, we mean games that'll make Microsoft money only. Call of Duty types, microtransactions, all of A lot of, we hear your emails that they ignore. Less experimental magic. can they come back from this? if they're going the same way as NVIDIA, where you don't invest proper things into your cards and they catch fire in PCs you're charging stupid money for basically just a better version. 

So, when you have a jump from, let's say, a to a 2080. Huge Massive. 

2080 to 3080. Huge jump. It a revolutionary jump to, like, DLSS, And then to the 40 series, it wasn't a big jump, but it was just enough to justify it. Because I they introduced the frame generation on the 40 And then the 50 series, which is so much more expensive than the 40 series. Without DLSS, it performs almost like a 40 series card. So, what they've done is they've just taken AI and been like, oh, here are some AI generated frames for you. But if you use it in competitive gameplay, you won't be able to kill anyone because the delay is too significant. And the frame doesn't know where the person's going. That's why you can only really have high frame generation in player games or multiplayer games, probably like Helldivers, maybe. But you cannot have it in competitive games. So, you're basically buying a card that cannot do well in competitive multiplayer. Anyway, Microsoft better drop some God-tier bangers because Sony and Nintendo are going to roast them alive. And a lot of people are going to just go out and buy PlayStations and Switches. But this was an unholy massacre. And it deserves to be called out, not just because of the games we lost, but because of why it happened. Quiet, cold, corporate, cruel. And to the devs laid off, you guys fucking rock. You made the magic. And I really hope that they actually land on their feet and start a great studio together. And to Microsoft, yeah, fuck you and get your shit together. You guys are arseholes. And to you, dear listener. Stay skeptical. Stay salty. And keep playing the games you love and that matter. And thanks for tuning in. We'll be back next week. Well, maybe next week. We'll see how it goes. As long as my mate is working and I'm not playing Helldivers, maybe next week. But next week's episode is probably going to be about EA probably haunted and what the hell Kojima is doing with his new horror game. Spoiler, it's weird. Or it probably won't be about that at all. So make you subscribe and leave a review. Make sure you leave a fucking review because it's hard to make these shows. God damn it. Anyway, love all of you who listen. Thank you very much. And peace, rage, and save often.