Microsoft Announces Additional Layoffs of 650 Xbox Employees

Microsoft has announced additional layoffs of 650 Xbox employees eight months after eliminating 1,900 jobs due to its $69 billion acquisition of Activision Blizzard in October 2023 and four months after shutting down three studios (Arkane Austin, Tango Gameworks and Alpha Dog).

The decision comes as part of the company’s broader strategy to reduce operations and focus on key growth areas. This is the third round of layoffs acquiring Activision Blizzard.

This time around, Spencer stated that no games, devices, or experiences are being canceled, and no studios are being shut down as a result of these cuts.

Variety has reported that Microsoft Gaming’s recent layoffs have affected the “Call of Duty: Warzone Mobile” team, with some employees being let go and others being reassigned to different projects within Activision. Additionally, Blizzard’s team for the newly launched “Warcraft Rumble” will also face cuts.

Microsoft Gaming CEO Phil Spencer sent the following email to employees:

Changes to Microsoft Gaming

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

[Sources]: Bloomberg (via MSN): Microsoft to Cut 650 Jobs in Latest Round of Xbox Unit Layoffs – [Archive] – [Screenshot]. Variety: Microsoft Gaming to Lay Off 3% of Global Workforce, About 650 Employees, in Additional Post-Activision Blizzard Cuts – [Archive] – [Screenshot].