In a significant restructuring move, Microsoft is set to implement further layoffs, particularly affecting its Xbox division. Reports from Bloomberg indicate that employees at both mobile gaming giant King and ZeniMax are among those impacted, with additional companies within the Microsoft ecosystem likely to follow suit. Today, U.S. firms will disclose the full extent of the job cuts.
Workforce Reduction Details
According to CNBC, Microsoft is enacting a four percent reduction in its workforce, which translates to over 9,000 positions being eliminated. This marks the fourth round of layoffs affecting Microsoft’s gaming sector in just 18 months.
Phil Spencer, the head of Xbox, addressed the situation in an internal memo, emphasizing the need for these cuts and a reduction in management layers to “position gaming for enduring success.” He acknowledged the current landscape, stating, “I recognize that these changes come at a time when we have more players, games, and gaming hours than ever before. Our platform, hardware, and game roadmap have never looked stronger.”
Spencer further elaborated on the rationale behind these difficult decisions, noting that the success Microsoft is experiencing today is rooted in the tough choices made in the past. “We must make choices now for continued success in future years,” he explained. “A key part of that strategy is the discipline to prioritize the strongest opportunities. We will protect what is thriving and concentrate effort on areas with the greatest potential, while delivering on the expectations the company has for our business.”
This focused approach, Spencer asserts, is essential for delivering exceptional games and experiences for players for generations to come. However, he also took a moment to reflect on the gravity of the situation, stating, “Prioritizing our opportunities is essential, but that does not lessen the significance of this moment. Simply put, we would not be where we are today without the time, energy, and creativity of those whose roles are impacted. These decisions are not a reflection of the talent, creativity, and dedication of the people involved. Our momentum is not accidental — it is the result of years of dedicated effort from our teams.”
