Virtuos, the renowned game development studio responsible for the highly anticipated The Elder Scrolls 4: Oblivion Remastered, is reportedly undergoing significant workforce reductions. Sources indicate that up to 300 employees may be affected by these layoffs, which appear to be concentrated in the company's Chinese offices but extend to its US and European branches as well.

This news comes amidst a wave of job cuts across the gaming industry, particularly affecting Microsoft-owned studios. While Virtuos operates independently, the studio seems to be mirroring the unfortunate pattern of downsizing that has become increasingly common in recent months.

French gaming journalist Gauthier Andres first reported the layoffs through a Bluesky thread, citing internal sources who revealed that approximately 7% of Virtuos's global workforce would be impacted. The cuts are said to be most severe in China, where about 200 positions are at risk, with an additional 100 jobs potentially eliminated in Western markets.

This development is particularly surprising given Virtuos's recent expansion, including the opening of a new studio in South Korea just months ago. The company has built a strong reputation through its work on high-profile projects like the Horizon Zero Dawn PC port, XCOM for iOS, and the Switch version of The Outer Worlds.

According to insider reports, Virtuos's contract for Oblivion Remastered did not include performance-based royalties, meaning the studio didn't directly benefit from the game's commercial success. As development concluded, the company reportedly reduced team bonuses and froze salary increases, foreshadowing the current workforce reductions.

Industry observers have noted Virtuos's increasing involvement with generative AI technology, though it remains unclear if this factor contributed to the layoffs. The move would align with broader industry trends, as other major companies like Xbox have been rumored to replace human employees with AI solutions.

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While the full impact of these layoffs remains to be seen, current indications suggest they won't affect ongoing projects like Oblivion Remastered or the upcoming Metal Gear Solid Delta. The gaming community awaits official statements from Virtuos as the situation continues to develop.