Microsoft gaming division suffers additional layoffs

Final week, it was rumored that Microsoft was preparing for a significant spherical of layoffs throughout the Xbox workforce. Bloomberg is now reporting that workers within the firm’s gaming division have been knowledgeable of job cuts Wednesday morning. The PC big has been on a cost-cutting mission currently, announcing it will let go of three % of its international workforce earlier this summer time, and saying a further 9,000 job cuts on Wednesday.

In response to Bloomberg, Microsoft’s Stockholm-based King division, well-known for Sweet Crush, is shedding 10 % of its employees, representing roughly 200 jobs. Whereas another European gaming places of work are additionally slicing, US items are reportedly being knowledgeable later Wednesday.

Phil Spencer, CEO of Microsoft Gaming, despatched an e-mail to all Microsoft Gaming workers concerning the layoffs, which was obtained by Windows Central and confirmed as genuine by Microsoft. In it, Spencer stated, “I acknowledge that these modifications come at a time when we’ve extra gamers, video games, and gaming hours than ever earlier than. Our platform, {hardware}, and recreation roadmap have by no means seemed stronger. The success we’re seeing at the moment relies on robust choices we have made beforehand. We should make decisions now for continued success in future years and a key a part of that technique is the self-discipline to prioritize the strongest alternatives.”

This is Phil Spencer’s full be aware to employees:

At present we’re sharing choices that can influence colleagues throughout our group. To place Gaming for enduring success and permit us to deal with strategic development areas, we’ll 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 this moment, the specifics of right this moment’s notifications and any organizational shifts will probably be shared by your workforce leaders within the coming days.

I acknowledge that these modifications come at a time when we’ve extra gamers, video games, and gaming hours than ever earlier than. Our platform, {hardware}, and recreation roadmap have by no means seemed stronger. The success we’re seeing at the moment relies on robust choices we have made beforehand. We should make decisions 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’ll 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 method 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 might not be the place we’re right this moment with out the time, power, and creativity of these whose roles are impacted. These choices are usually not a mirrored image of the expertise, creativity, and dedication of the individuals concerned. Our momentum is just not unintended—it’s the results of years of devoted effort from our groups.

HR is working immediately 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. Staff whose roles have been eradicated are inspired to discover open positions throughout Microsoft Gaming, the place their functions will probably be given precedence assessment.

Thanks to everybody who has formed our tradition, our merchandise, and our group. We’ll transfer ahead with deep appreciation and respect for all who’ve contributed to this journey.

As a part of right this moment’s layoffs, a number of video games, including Rare’s Everwild, have been cancelled and The Initiative, the Xbox studio which was producing the Excellent Darkish reboot, has been shut down. The information was damaged to the workforce by Matt Booty, head of Xbox Recreation Studios, who stated Microsoft “didn’t make these decisions calmly, as every venture and workforce symbolize years of effort, creativeness, and dedication.”

This is Matt Booty’s full be aware to employees:

Following Phil’s be aware, I need to share extra in regards to the modifications to the Studios enterprise items.

Now we have made the choice to cease improvement of Excellent Darkish and Everwild in addition to wind down a number of unannounced initiatives throughout our portfolio. As a part of this, we’re closing one among our studios, The Initiative. These choices, together with different modifications throughout our groups, replicate a broader effort to regulate priorities and focus sources to arrange our groups for larger success inside a altering trade panorama. We didn’t make these decisions calmly, as every venture and workforce symbolize years of effort, creativeness, and dedication.

Our general portfolio technique is unchanged: construct video games that excite our gamers, proceed to develop our greatest franchises, and create new tales, worlds, and characters. Now we have greater than 40 initiatives in lively improvement, continued momentum on titles delivery this fall, and a robust slate headed into 2026.

For these immediately affected, we’re working intently with HR and studio management to supply assist, together with severance, profession transition help, and the place attainable, alternatives to discover roles on different groups.

To everybody throughout our studios: thanks. Your creativity and resilience proceed to outline who we’re. I consider within the energy of our groups and the route we’re taking up the trail forward.

Final yr, Microsoft slashed almost 2,000 jobs from its gaming division, affecting workers throughout Xbox and Activision Blizzard. In the identical yr, it additionally shuttered a trio of ZeniMax recreation improvement groups after having acquired the online game holding firm in 2021. This would be the fourth spherical of cuts at Xbox within the final 18 months. These layoffs come in opposition to the backdrop of Microsoft’s $69 billion acquisition of Activision Blizzard in October 2023.

The gaming trade has had a rocky couple of years, with an estimated 11 % of recreation builders dropping their jobs in 2024. Microsoft’s earnings have been on a gradual upward trajectory, with the corporate reporting over $25 billion in web earnings in its final quarterly report. When requested for remark, a Microsoft spokesperson advised Engadget that the corporate “[continues] to implement organizational and workforce modifications which are essential to place the corporate and groups for achievement in a dynamic market.”

Replace, July 2, 6:45PM ET: This story has been up to date a number of occasions since publishing to incorporate affirmation of the particulars of the layoffs, the cancellation of a number of video games, the shuttering of The Initiative, and an infuriatingly obscure remark from a Microsoft spokesperson.

In the event you purchase one thing by means of a hyperlink on this article, we could earn fee.

Trending Merchandise