Microsoft announced a new wave of layoffs — this time around 650 employees from the gaming division will be left without work. This was reported by The Verge, which reviewed a letter from Phil Spencer.
The head of Xbox stated that the layoffs will mainly affect corporate and support positions. The letter particularly emphasizes that the development of games and other projects is progressing at the same pace.
For the past year, our goal has been to minimize disruption while welcoming new teams and enabling them to do their best work. As part of aligning our post-acquisition team structure and managing our business, we have made the decision to eliminate approximately 650 roles across Microsoft Gaming — mostly corporate and supporting functions — to organize our business for long term success.
I know that this is difficult news to hear. We are deeply grateful for the contributions of our colleagues who are learning they are impacted. In the US, we're supporting them with exit packages that include severance, extended healthcare, and outplacement services to help with their transition; outside the US packages will differ according to location.
With these changes, our corporate and supporting teams and resources are aligned for sustainable future growth, and can better support our studio teams and business units with programs and resources that can scale to meet their needs. Separately, as part of running the business, there are some impacts to other teams as they adapt to shifting priorities and manage the lifecycle and performance of games. No games, devices or experiences are being cancelled and no studios are being closed as part of these adjustments today.
Throughout our team's history, we have had great moments, and we have had challenging ones. Today is one of the challenging days. I know that going through more changes like this is hard, but even in the most trying times, this team has been able to come together and show one another care and kindness as we work to continue delivering for our players. We appreciate your support as we navigate these changes and we thank you for your compassion and respect for each other.
Phil
The layoffs are another step in the business optimization process following the purchase of Activision Blizzard for $68.7 billion. At the beginning of 2024, Microsoft laid off 1900 employees from Activision Blizzard and Xbox, and in the spring announced the closure of four studios, including Arkane Austin and Tango Gameworks.