On August 11, Xbox CEO Asha Sharma visited Bethesda's headquarters in Rockville, Maryland, where she reportedly received a "live playthrough" demonstration of the long-awaited Elder Scrolls VI. Sharma posted about the experience on social media, saying the game's "scale and grandeur are incredible" and that "the story is even greater," while teasing a censored subtitle represented by eight asterisks. The Elder Scrolls VI was originally announced in 2018 and has not yet been shown publicly beyond executive comments like Sharma's.
While Sharma toured the studio, members of the Bethesda Game Studios Union (OneBGS-CWA) organized a visible protest outside the building. Workers inflated a giant rat—a figure commonly used at labor protests and often nicknamed Scabby—and planted rows of red flags, each representing an employee laid off from Microsoft's gaming division. Sources differ on the exact number of flags used, with some describing "hundreds" and one report specifying 800 flags representing layoffs since July 2025.
According to a statement from Nathan Hahn, a technical producer and OneBGS-CWA member, workers initially tried to display posters inside the office to make their presence felt but were told by management to remove them because they faced outward from cubicles. Employees then used balloons instead, while a separate team of laid-off developers set up the flag display outside. Hahn said the actions were meant to push back against the layoffs and to pressure Microsoft and the wider industry to stop similar cuts in the future.
The protest comes amid a broader restructuring at Xbox, which has already cut about 1,600 jobs with another 1,600 expected by the end of the year, part of a total of roughly 3,200 layoffs Sharma has said are necessary to return the company to profitability. The cuts have led to studios such as Double Fine and Compulsion Games being spun off as independent companies, while the futures of Ninja Theory, Undead Labs, and Arkane Lyon remain uncertain. Bethesda's Montreal staff were reportedly told last month that they would receive the smallest severance allowed by law.
Xbox and Bethesda have said The Elder Scrolls VI will not be affected by the layoffs, but some employees have pushed back on that assurance, with one id Software developer publicly criticizing Microsoft's understanding of game development. Next week, on August 18, Xbox workers plan to hold rallies across the U.S. and Canada in coordination with the Communications Workers of America to protest the layoffs and push for stronger job protections in future union contracts.