Obsidian’s Director Responds to Fallout Rumors After Xbox Layoff Reports
Obsidian’s game director Brandon Adler has pushed back hard against what he calls an “enormous amount of misinformation” circulating online after reports suggested the studio is developing another Fallout title. He specifically targeted fan skepticism about whether Obsidian can deliver a project worthy of its reputation—especially now that many of the creators who shaped its best-known Fallout offshoot are no longer with the company.
It’s also hard to ignore the studio’s recent situation. On July 6, Xbox CEO Asha Sharma announced another major reshuffle for Microsoft’s struggling gaming arm, with plans to cut around 3,200 roles—about one-fifth of the division’s workforce. Microsoft says it has already identified and informed roughly half of the impacted employees, while the rest are expected to be gone by the end of June 2027, matching the end of the company’s current fiscal year. The restructuring touched Xbox teams of all sizes, including Obsidian, which reportedly lost about a quarter of its roughly 220-person staff.
Microsoft stated that these cuts did not cancel any already revealed first-party projects. Still, Bloomberg’s Jason Schreier reported that several unannounced Obsidian games were paused or shelved during the reorganization, and that a substantial portion of the team was reassigned to a new Fallout effort.
A leak has since added fuel to the conversation, claiming Xbox has directed Obsidian to build a new Fallout game. Below are the key points that were outlined as confirmed by the reporting.
Obsidian Director Dismisses Fan Skepticism Over New Fallout Game
Quick facts
- Brandon Adler criticized online “misinformation” about Obsidian and a rumored new Fallout project.
- Adler responded to backlash tied to whether Obsidian can match what it previously delivered on Fallout: New Vegas.
- Xbox announced another restructuring on July 6, targeting about 3,200 jobs (around 20% of the workforce).
- Microsoft said the layoffs began with notifications to about half of impacted employees, with the rest expected by June 2027.
- Obsidian reportedly lost about a quarter of its workforce (approximately 220 staff).
- Microsoft said no previously announced first-party projects were canceled.
- Unannounced Obsidian games were reportedly shelved, with much of the studio redirected to a new Fallout game.
- Adler argued that Obsidian’s creative “DNA” remains unchanged despite the shakeups.
- Longtime fans have been expressing interest since the rumored project leaked on July 8.
In a July 11 LinkedIn update, Obsidian game director Brandon Adler said goodbye to dozens of colleagues who were laid off in the newest wave of Xbox cuts. “This has been an extremely difficult week at Obsidian,” Adler wrote, then turned to what he called another painful element: public criticism of the studio that he believes is completely unjustified.
Adler’s frustration was especially pointed at claims that Obsidian has lost the ability to make great games because so much of the Fallout: New Vegas creative team has moved on. He wrote that he’s seen people talk about Obsidian “not who they used to be” even when they don’t understand who worked on past releases or what those teams contributed. “The number of times I’ve seen people, with no understanding of who has worked on our previous games or what they contributed, talk about how Obsidian isn’t who they used to be… is staggering,” he wrote.
Adler Insists the Studio’s “DNA” Hasn’t Changed Even If Not Many New Vegas Devs Remain
Adler argued that, even after the recent round of layoffs, Obsidian still has most of its senior creative positions filled by veterans tied to Fallout: New Vegas, Pillars of Eternity, The Outer Worlds, and other well-regarded RPG projects. While he acknowledged that every company inevitably changes across two decades, he maintained that Obsidian’s creative “DNA” remains the same.
He dismissed the online speculation that contradicts that view, saying it comes from uninformed “cold take artists.” In his words, the problem isn’t just disagreement—it’s that many of the takes are wrong and backed by “an enormous amount of misinformation.”
Adler’s decision to address critics also underlines how loud the discussion has been recently. That said, it doesn’t automatically mean those voices represent the broader player base. Many long-running fans have reportedly been excited about the possibility of another Obsidian-made Fallout game since the purported project first surfaced online on July 8.
Adler’s defense aligns with how the studio has performed since the New Vegas era ended. After the 2010 release of the fan-favorite Fallout entry set in the Mojave, Obsidian went on to deliver more than half a dozen notable RPGs, including South Park: The Stick of Truth, Tyranny, Grounded, and Pentiment.
Looking at Obsidian’s more recent run, its two 2025 releases—Avowed and The Outer Worlds 2—sit at “Mostly Positive” Steam sentiment as of mid-2026. Even so, both have reportedly landed in the low 80s on OpenCritic, were nominated for multiple major awards, and also picked up some smaller honors. Taken together, the studio’s overall track record suggests its baseline quality may still be higher than what many mid-sized competitors manage at their best.
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That history doesn’t guarantee the rumored Fallout project will land well, but it does provide a reason for cautious confidence. The situation looks even more promising because Fallout creator Tim Cain currently works at Obsidian. Cain reportedly returned from retirement in late 2025 to contribute to an unannounced project, which raises the possibility that he could again be involved in the post-apocalyptic series he helped create.
