Microsoft has laid off hundreds of employees throughout its varied divisions within the newest cost-cutting measures taken by the company, whose 2024 income exceeded $245 billion, a 16-percent enhance over its 2023 income. Although the cuts have impacted a number of of the corporate’s varied divisions, Xbox seems to be hit notably laborious. This represents the fourth time in 18 months that Microsoft Gaming has laid off employees.
“We proceed to implement organizational and workforce adjustments which might be essential to place the corporate and groups for achievement in a dynamic market,” an Xbox spokesperson mentioned in an official remark supplied to Sport Informer. Alongside the official assertion, Xbox PR confirmed that lower than 4 % of Microsoft’s international workforce was impacted. Nevertheless, based on Microsoft’s official reporting, the corporate employs 228,000 folks worldwide, which implies 4 % of the worldwide workforce accounts for greater than 9,100 folks. Xbox PR additionally confirmed to Sport Informer that the gaming division is impacted, “however not the bulk,” and stopped wanting offering any extra particulars. Once I requested a proportion of Xbox-specific affect, PR couldn’t present extra context.
Nevertheless, Selection and several other different retailers obtained a memo to Xbox workers from Microsoft Gaming CEO Phil Spencer. Notably, Spencer says, “Our platform, {hardware}, and sport roadmap have by no means appeared stronger,” and “Merely put, we’d not be the place we’re with out the time, vitality, and creativity of these whose roles are impacted.” You possibly can see that in its entirety beneath.
In the present day we’re sharing selections that may affect colleagues throughout our group. To place Gaming for enduring success and permit us to concentrate on strategic development areas, we are going to finish or lower work in sure areas of the enterprise and comply with Microsoft’s lead in eradicating layers of administration to extend agility and effectiveness. Out of respect for these impacted right now, the specifics of right now’s notifications and any organizational shifts shall be shared by your staff leaders within the coming days.
I acknowledge that these adjustments come at a time when now we have extra gamers, video games, and gaming hours than ever earlier than. Our platform, {hardware}, and sport roadmap have by no means appeared stronger. The success we’re seeing at the moment relies on robust selections we’ve made beforehand. We should make selections now for continued success in future years and a key a part of that technique is the self-discipline to prioritize the strongest alternatives. We are going to defend what is prospering and focus effort on areas with the best potential, whereas delivering on the expectations the corporate has for our enterprise. This centered strategy means we are able to ship distinctive video games and experiences for gamers for generations to return.
Prioritizing our alternatives is important, however that doesn’t reduce the importance of this second. Merely put, we’d not be the place we’re right now with out the time, vitality, and creativity of these whose roles are impacted. These selections aren’t a mirrored image of the expertise, creativity, and dedication of the folks concerned. Our momentum isn’t unintentional—it’s the results of years of devoted effort from our groups.
HR is working straight with impacted workers to supply severance plan advantages (aligned with native legal guidelines), together with pay, healthcare protection, and job placement sources to assist their transition. Workers whose roles had been eradicated are inspired to discover open positions throughout Microsoft Gaming, the place their purposes shall be given precedence evaluate.
Thanks to everybody who has formed our tradition, our merchandise, and our group. We are going to transfer ahead with deep appreciation and respect for all who’ve contributed to this journey.
Phil
Subsequently, The Verge acquired a memo despatched by Xbox president of sport content material and studios, Matt Booty. In his memo, Booty confirms Xbox is closing down The Initiative, an all-new first-party studio based by Xbox in 2018 in Santa Monica, California. In 2020, The Initiative revealed it was engaged on a brand new entry within the Good Darkish franchise, which is now canceled on account of this closure. Booty additionally confirms the Twycross, England-based Uncommon, which Xbox acquired in 2002 and has labored on titles like Sea of Thieves and Viva Piñata, has been impacted by this spherical of layoffs, and its new IP, Everwild, which was introduced in 2019, has additionally been canceled. You possibly can learn his full memo beneath.
Following Phil’s word, I need to share extra concerning the adjustments to the Studios enterprise models.
We have now made the choice to cease improvement of Good Darkish and Everwild in addition to wind down a number of unannounced tasks throughout our portfolio. As a part of this, we’re closing one in all our studios, The Initiative. These selections, together with different adjustments throughout our groups, replicate a broader effort to regulate priorities and focus sources to arrange our groups for higher success inside a altering trade panorama. We didn’t make these selections evenly, as every venture and staff symbolize years of effort, creativeness, and dedication.
Our general portfolio technique is unchanged: construct video games that excite our gamers, proceed to develop our largest franchises, and create new tales, worlds, and characters. We have now greater than 40 tasks in energetic improvement, continued momentum on titles delivery this fall, and a powerful slate headed into 2026.
For these straight affected, we’re working intently with HR and studio management to supply assist, together with severance, profession transition help, and the place potential, alternatives to discover roles on different groups.
To everybody throughout our studios: thanks. Your creativity and resilience proceed to outline who we’re. I imagine within the power of our groups and the route we’re taking over the trail forward.
Matt
In response to Bloomberg, Sweet Crush developer King, which Xbox acquired in 2023 as a part of the blockbuster $68.7 billion Activision Blizzard King deal, is slicing 10 % of its workers, which quantities to round 200 jobs, and ZeniMax, which Xbox acquired in 2021 as a part of its $7.5 billion acquisition of Bethesda, suffered losses. In response to that very same report, a brand new MMORPG that was in improvement at ZeniMax On-line Studios, has additionally been canceled. In the meantime, Bloomberg additionally reviews Raven Software program, which was acquired as a part of the Activision Blizzard King buy and has labored extensively on latest Name of Obligation titles, can be impacted. The Verge additionally reviews that Forza Motorsport developer Flip 10 Studios can be closely impacted by these cuts, with greater than 70 folks reportedly laid off.
Microsoft has laid off hundreds upon hundreds of employees over the past 18 months, together with 1,900 workers in January 2024. In Could 2024, Xbox closed Arkane Austin, Tango Gameworks, and Alpha Canine Video games, and laid off a number of workers at ZeniMax, all of which had been acquired alongside Bethesda in 2021.
Our sincerest effectively needs exit to all these impacted by the most recent spherical of cuts.
Replace at July 2, 2025, 3:51pm CT:
Aftermath is reporting that Blizzard was additionally impacted by Wednesday’s layoffs. In response to an electronic mail from Blizzard president Johanna Faries that Aftermath seen, the corporate is basically transferring Warcraft Rumble, the 2023 free-to-play cellular sport, into upkeep/live-ops mode. Which means that whereas the sport will nonetheless be supported, no new content material will doubtless be produced.
In response to the e-mail seen by Aftermath, Faries reportedly said that “a number of” of the Warcraft Rumble builders are transitioning to new tasks, however some had been affected by the layoffs. Faries additionally reportedly talked about impacts to Blizzard’s customer support and advertising and marketing departments. In response to the report, the variety of impacted Blizzard workers might attain as excessive as 100, with the Overwatch staff showing to flee unscathed this time round.
