Obsidian Entertainment, an Irvine-based video game development studio, is laying off 52 workers as part of a larger restructuring to reset Microsoft’s Xbox video game business.

In a letter filed July 6 with the state’s Employment Development Department, Jason Tucker, Obsidian’s director of human resources, wrote that 43 positions at the company’s facility at 100 Spectrum Center Drive, would be laid off effective Sept. 4.

Another nine remote positions within California also would be eliminated, he said.

Tucker, who wrote the Irvine facility would not be closed, said that the layoffs are part of Obsidian’s plan to “reorganize and restructure operations.”

Last week, Microsoft announced plans to cut 4,800 jobs, about 2.1% of its global workforce, including 1,600 workers at its Xbox video game business.

“Our business today is not healthy,” according to a memo from Xbox CEO Asha Sharma, who took over the gaming division earlier this year.

Sharma said that the industry, in which Xbox competes with Sony’s PlayStation and Nintendo’s Switch, is facing a “hardware crisis” as costs soar for console components.

Obsidian was founded in 2003 by former developers of Black Isle Studios, an in-house development unit of Interplay Entertainment.

Interplay shutdown Black Isle in 2003 due to financial struggles, with key developers and designers moving on to form Obsidian. In 2018, Microsoft bought the video game maker known for its “role-playing games,” or RPGs, like Fallout: New Vegas, The Outer Worlds, and the Pillars of Eternity series.

In RPG games, players assume the roles of characters in a fictional setting, shaping the story through their choices and actions.

The filing with the state’s EDD was made as part of the federal Worker Adjustment and Retraining Notification Act — commonly referred to as a WARN notice.The filings are required when an employer lays off more than 50 employees.

The Obsidian layoffs include engine software, graphic design and gameplay engineers, software designers, environment, character and technical artists, directors and a financial manager, according to the filing.

Nearly three years ago, Microsoft closed a $69 billion deal to acquire gaming giant Activision Blizzard, maker of “Call of Duty” and other blockbuster franchises. The Irvine business of MIcrosoft’s Activision has not been immune to layoffs in recent years.

An Activision spokeswoman could not immediately comment on whether the recent announcement by Microsoft to layoff 1,600 workers in its video game businesses might impact her company as well.

In September 2024, Activision announced the layoffs of 400 workers in its in mobile gaming divisions in Santa Monica and Irvine, eliminating redundancies among its staff. These layoffs came on top of more than 1,000 made throughout 2024 by Activision, ranging from operations in Novato and Foster City in the Bay Area to Southern California offices, according to EDD filings.

Activision’s Irvine campus along Alton Parkway — along with other regional Activision offices —remains a core development hub, employing thousands of staff focused on major franchises like World of Warcraft and Diablo.