Before cancelling ZeniMax's Destiny-style MMO shooter, Xbox executives reportedly enjoyed early demos so much that the controller had to be pulled from Phil Spencer's hands

Yesterday, Microsoft started its latest round of layoffs, aiming to eliminate 9,000 jobs after previously cutting more than 12,000 employees over the last two years. The latest downsizing has led to studio closures and game cancellations—including Blackbird, an unannounced MMO in development at ZeniMax that Xbox executives were reportedly thrilled about before abruptly killing the project.

Bloomberg's Jason Schreier reports that production for Blackbird began at ZeniMax in 2018. A Destiny-esque third person shooter MMO with a scifi noir aesthetic, Blackbird was being developed by a team of 300 employees. Its gameplay seemingly placed a greater emphasis on verticality and acrobatics, offering traversal tools like grappling hooks, wall climbing, and air dashes.

Blackbird had been a hit with Xbox executives. According to sources familiar with its development, Microsoft Gaming CEO Phil Spencer was so impressed with an internal demo in March that Xbox Games Studios head Matt Booty had to pull the controller from his hands in order to stop him from holding up a meeting. All signs looked overwhelmingly positive, and the game's development proceeded towards a tentative 2028 launch.

On Wednesday, those developers logged into Slack to see that the accounts for the game's executive producer and creative director were missing. In a meeting later that morning, they were informed that Blackbird was "shelved indefinitely." The team lost their Slack accounts in the aftermath, leaving them in a kind of "job purgatory" as Microsoft negotiates with ZeniMax's union, which organized last year, over severance packages.

As a seemingly promising game project from a proven MMO developer, Blackbird's cancellation is a frustrating one, especially when Microsoft and Xbox alike are happy to describe their ongoing unprecedented successes.

In a memo sent to Xbox employees when yesterday's layoffs were announced, Spencer said that the gaming division has "more players, games, and gaming hours than ever before." In Microsoft's 2024 annual report, CEO Satya Nadella said the company achieved "record performance," delivering an operating profit of $109 billion—a 24% increase from the year before.