Microsoft Corp. will conduct another round of major layoffs in its Xbox division next week as part of a company-wide reorganization, Bloomberg reported.
Managers within Xbox are expecting substantial cuts across the entire group, according to people familiar with the plans who asked not to be identified discussing nonpublic information. The company declined to comment.
This will be the fourth big layoff at Xbox in the past 18 months, following three major cuts last year and the closure of several subsidiaries. Xbox, which produces video-game hardware and software, has been under pressure from Microsoft executives to boost profit margins since purchasing Activision Blizzard Inc. for $69 billion in a deal that closed in 2023.
The Verge reported: Microsoft is planning to cut jobs in the company’s Xbox gaming business, as early as next week. Tom Warren reported in Notepad earlier this month that Microsoft was planning Xbox layoffs “potentially by the end of the month.” And now, Bloomberg says a round of “major layoffs” is due next week.
Microsoft is planning to restructure parts of its Xbox business as it looks ahead to its next generation of consoles. One source told Tom Warren that Microsoft is restructuring Xbox distribution across central Europe, resulting in some Xbox operations ceasing in some regions.
These latest layoffs will be in addition to the 6,000 cuts Microsoft already made in May, and on top of the more than 300 impacted earlier this month, too. Any major Xbox cuts will be the latest in a series of big gaming-related layoffs over the past 18 months, after Microsoft laid off 1,900 Activision Blizzard and Xbox employees.
Engadget reported: It seems the cuts just keep on coming within Microsoft’s gaming division. A company-wide reorganization is taking place, and that’s slated to include another major round of layoffs within the Xbox team. Those cuts will be confirmed next week, according to Bloomberg.
Microsoft confirmed last month that it would lay off about three percent of its total workforce across all teams, levels and regions in an attempt to streamline operations and flatten its management structure. That equates to around 7,000 people losing their jobs. Per Bloomberg’s report, Xbox managers are anticipating “substantial cuts across the entire group.”
Microsoft cut 1,900 workers from its gaming division in January 2024, and another 650 last September. It also closed down Arkane Austin and Alpha Dog Games last year, while merging Roundhouse Studios into ZeniMax Online Studios. It shut down Tango Gameworks as well, but Krafton — the publisher of PUBG: Battlegrounds — acquired that studio in late August.