Zenimax Online Studios laid off more than 200 employees in July 2026, including the entire senior leadership team of Elder Scrolls Online (ESO), as part of broader Xbox layoffs affecting over 3,200 staff this fiscal year [1, 2, 3, 4, 5].

The departing senior leaders include studio head Joe (Jo) Burba, a 14-year veteran appointed to the role in July 2025, executive producer Susan Kath, game director Rich Lambert, and production director Ala Diaz [1, 2, 3, 4, 5]. They will stay with the studio for several months to support the transition to new leadership [1, 3, 4, 5].

The new leadership will be co-led by Josh Henderson, former head of business operations, and Nick Giacomini, promoted to game director in August 2025 [1, 2, 3, 4, 5]. Burba expressed confidence in the new team, saying, "We have tremendous confidence in Josh and Nick, the future of this studio, and the continued growth of ESO" [3].

Zenimax Online Studios has shrunk by approximately 40% since 2024 following previous layoffs in 2025 and 2026, including the cancellation of an MMO project codenamed Project Blackbird and the departure of former studio head Matt Firor [1, 2, 3, 5]. The Maryland-based studios, including ZeniMax Media Inc., saw 379 layoffs this fiscal year [1, 3, 4, 5].

Despite the cuts, studio and community managers assured players that ESO development will continue. Kevin Gbolie, ESO community manager, said, "The plan is still to deliver great content, and we will hopefully have an update soon" [2]. The departing leadership added in a joint statement, "With exciting experiences still ahead for our players as we wrap up work for Update 51 and beyond, we believe that your passion, creativity, and commitment to each other and the community will continue serving as the heartbeat of ESO" [5].

However, some developers voiced concerns over reduced capacity. Senior encounter designer Morgan Goin stated, "We're not going to be able to put out the amount of content at the speed that we were… or anything approaching that" [3, 5].

The outgoing leaders are expected to remain for a few months to assist with the handover to the new leadership team [1, 3, 4, 5].