Microsoft discontinues the development of Everwild, a project by Rare, concurrently making workforce reductions.
In a significant shakeup for the gaming industry, Microsoft has announced the cancellation of several highly anticipated games as part of its 2025 layoffs. The affected titles include Rare's Everwild, the upcoming MMORPG from ZeniMax Online Studios codenamed Blackbird, and the long-awaited Perfect Dark reboot.
Everwild, the follow-up to Rare's Sea of Thieves, was a much-anticipated new IP from the studio known for its innovative multiplayer experiences. However, the game has faced a troubled development cycle with little progress shown, and it has now been officially canceled.
Blackbird, intended as a successor project to The Elder Scrolls Online, was also in the works at ZeniMax Online Studios. This MMORPG reportedly featured branching dialogue trees akin to Mass Effect or Star Wars: The Old Republic. However, like Everwild, it has now been canceled.
Perfect Dark, developed by The Initiative with assistance from Crystal Dynamics, was another highly anticipated title. The project had been in development for over five years, but troubles led to its shutdown and cancellation. The Initiative studio itself has also been closed.
Other first-party titles such as State of Decay 3 by Undead Labs remain in development despite layoffs affecting that studio. Xbox hardware efforts have largely been spared from cuts, indicating the focus of Microsoft's cost-saving measures is on game development and studio management.
Microsoft's CEO of Gaming, Phil Spencer, acknowledged the tough decisions as necessary for Xbox's long-term sustainability, despite the current strong business performance. Since 2023, Microsoft has laid off more than 10,000 people, with nearly 2,000 affected in February 2024, and another 650 cuts in September 2024. In February 2025, Phil Spencer confirmed Everwild was still in development, but it has now been officially canceled.
The reasons for Everwild's cancellation remain unclear. Social media posts indicate several other studios have also been affected, including Halo Studios. Microsoft has announced layoffs affecting its European-based King subsidiary, resulting in a reduction of approximately 200 jobs. No new job reduction numbers have been specified for The Initiative.
Turn 10, the developer of Forza Motorsport, has lost nearly half its staff. In July, Microsoft announced additional layoffs following the loss of 6,000 positions in May. The cancellation of Blackbird and the closing of The Initiative are part of the ongoing layoffs at Microsoft.
This latest round of cancellations is a significant blow to the gaming industry and to fans who have been eagerly awaiting these titles. As the story on the Microsoft layoffs continues to develop, updates will be provided as more information becomes available.
The cancellation of Rare's Everwild, a much-anticipated new IP, and Blackbird, the MMORPG from ZeniMax Online Studios, signify forays into technology and entertainment that will not materialize, regardless of their initial promises. Meanwhile, the long-awaited Perfect Dark reboot, developed by The Initiative, is another victim of this wave in the sports sector, with the studio itself also shut down.
