Microsoft’s latest wave of gaming layoffs continues to send shockwaves through its studios, and this time, it’s hit one of its longest-standing teams: ZeniMax Online Studios. Matt Firor, the director who helped launch ZeniMax in 2007 and guided The Elder Scrolls Online to long-term success, has announced he is stepping down later this month after 18 years at the helm.
Firor shared the news on the official Elder Scrolls Online X account just hours after the Microsoft layoffs hit the headlines. He went on to reassure players that the new leadership team has been behind some of ESO’s biggest ideas and expansions and will continue to shape the game’s future. Though he’s stepping away from development, Firor says he plans to remain an active player, adding that “there are many more stories to be told, adventures to be had, and I know this amazing community will carry that shared legacy and success forwards.”
The leadership change at ZeniMax comes alongside the reported cancellation of an unannounced MMO project known internally as “Blackbird,” which had been quietly in development since 2018. While Microsoft has not made any official announcement, multiple ZeniMax developers have corroborated the news on LinkedIn, following an initial report from Bloomberg’s Jason Schreier on Bluesky. According to PCGamer, senior staff including lead engineer Aaron Barnett, senior character artist Eric Hall, and senior producer Chris Linn all referenced the cancellation in public posts, confirming that the long-running project has been scrapped.
ZeniMax’s changes are part of a larger wave of restructuring under the Xbox umbrella. Microsoft recently announced the layoff of approximately 9,100 employees—around 4% of its global workforce—impacting multiple game studios including Bethesda, King, and Rare. Several projects have been cut or canceled, including the long-troubled Everwild from Rare. You can catch up on the full scope of those cuts in our recent coverage of the Microsoft layoffs.
For ZeniMax specifically, the cancellation of Blackbird marks a rare retreat from the MMO space where the studio has been most successful. The Elder Scrolls Online remains one of the most enduring and consistently updated MMORPGs on the market, and Firor’s departure signals not just the end of an era but also a potential shift in focus as Microsoft tightens its portfolio around proven franchises.
For now, fans of ESO can breathe easy—the game isn’t going anywhere. In fact, Firor made it clear he’s leaving the game in the hands of a team he trusts to continue expanding the world of Tamriel for years to come. The internal promotion of Jo Burba to Studio Head suggests continuity rather than upheaval, even as broader changes reshape the landscape around ZeniMax.
“The studio and The Elder Scrolls Online will be in great hands under the direction of new Studio Head Jo Burba, along with Executive Producer Susan Kath and Game Director Rich Lambert.”
Microsoft’s latest round of layoffs reflects ongoing efforts to streamline its massive gaming empire following high-profile acquisitions like Activision Blizzard. While the company insists these decisions are about “prioritizing opportunities,” the human cost—and the loss of creative projects like Blackbird—continues to mount.
