In the wake of Xbox’s sweeping workforce reductions, Kotaku reports that roughly a quarter of Obsidian Entertainment—known for titles such as Avowed, The Outer Worlds, and Pentiment—has been dismissed.
Sources confirm that approximately 60‑70 employees were let go, spanning roles from producers and artists to programmers, QA testers, writers, and more. LinkedIn posts from those affected reveal that many were seasoned professionals, some boasting over a decade at the studio, including the art director of The Outer Worlds and Obsidian’s sole recruiter.
The bulk of these departures occurred on July 6, coinciding with Xbox’s initial wave of 1,600 cuts, while a handful of employees were informed they would be released later in the year as part of a secondary round. Remaining staff have yet to receive clear guidance on how to sustain their current projects amid the sudden talent vacuum, especially given the studio’s extensive slate of upcoming releases.
Despite the upheaval, Kotaku reports that development on Grounded 2, still in early access, and the announced DLC for The Outer Worlds 2 should proceed, though future plans remain uncertain. Employees anticipate further clarification during a company‑wide meeting scheduled for July 7.
Founded in June 2003 by former Black Isle veterans Feargus Urquhart, Chris Avellone, Chris Parker, Darren Monahan, and Chris Jones, Obsidian Entertainment has grown into a revered name in the industry. Over the past two decades, the studio has delivered a wide array of celebrated titles—from the iconic Star Wars: Knights of the Old Republic II: The Sith Lords and Neverwinter Nights 2 to the narrative‑rich Alpha Protocol, the cult classic Fallout: New Vegas, and the critically acclaimed Pillars of Eternity series.
After Microsoft acquired the studio in 2018, Obsidian expanded its portfolio with the launch of The Outer Worlds (both installments), the sandbox survival game Grounded (now available in early access for both versions), the upcoming first‑person RPG Avowed, and the award‑winning historical drama Pentiment.
Pentiment, released in 2022, earned a prestigious Peabody Award and the Game Developers Choice Award for Best Narrative, cementing its status as a standout storytelling experience. Meanwhile, The Outer Worlds, which debuted in 2019, captured Game of the Year at the New York Game Awards, RPG of the Year at the DICE Awards, and a Nebula Award for game writing, among a host of other honors.
❓ Frequently Asked Questions (FAQ)
How many staff were let go from Obsidian Entertainment due to Xbox cuts?
According to Kotaku, roughly 60‑70 employees—about a quarter of the studio—were dismissed as part of Xbox’s workforce reductions.
Which roles were affected and what impact could this have on Obsidian's projects?
The layoffs included producers, artists, programmers, QA testers, writers, and even senior creative positions such as the art director of The Outer Worlds and the studio’s sole recruiter. Losing this senior talent could stall Obsidian’s ambitious pipeline, potentially delaying upcoming projects and affecting Xbox’s broader first‑party strategy.
Will development on Grounded 2 and The Outer Worlds 2 DLC continue after the layoffs?
Kotaku reports that development on Grounded 2 (still in early access) and the announced DLC for The Outer Worlds 2 should proceed, although future plans remain uncertain and further clarification is expected in a company‑wide meeting on July 7.
News Source: Kotaku
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