REDMOND, WA – Microsoft prepares for significant layoffs in its gaming sector, potentially impacting Xbox staff as early as next week.
Breaking: Major Job Cuts Expected
Microsoft is reportedly planning substantial job cuts across its gaming division, including the Xbox unit, according to sources. Bloomberg has indicated that these layoffs are part of a broader restructuring effort within the company.
The Verge reports that managers have been briefed about the impending cuts, which are expected to affect sales teams significantly. These layoffs are anticipated ahead of the release of Microsoft’s next generation of gaming consoles.
Immediate Impact on Xbox Division
In a strategic move, Microsoft recently announced a partnership with AMD to power future Xbox consoles, including its first-party devices. However, the company has not disclosed the launch timeline for these new products.
Additionally, The Verge notes that Microsoft is restructuring its central European Xbox distribution, with plans to cease operations in certain regions.
Key Details Emerge
Employees at Microsoft, speaking anonymously to protect their careers, have expressed concerns over the looming layoffs. Many feel it’s a question of “when, not if” the cuts will occur.
Since acquiring Activision Blizzard for $69 billion, Microsoft has made significant reductions in its gaming workforce.
Industry Response and Analysis
Xbox boss Phil Spencer, in a June 2024 interview with IGN, stated, “I have to run a sustainable business inside the company and grow, and that means sometimes I have to make hard decisions that frankly are not decisions I love, but decisions that somebody needs to go make.”
This statement underscores the challenging balance between innovation and financial sustainability that the gaming giant faces.
By the Numbers
- January 2024: 1,900 staff laid off
- September 2024: 650 additional layoffs
- May 2025: 6,000 staff, or 3% of the workforce, cut
Background Context
The announcement comes as Microsoft continues to navigate the complexities of a rapidly evolving gaming industry. The acquisition of Activision Blizzard was a significant strategic move, yet it has led to substantial workforce reductions.
According to sources familiar with the company’s internal discussions, these layoffs are part of a broader effort to streamline operations and focus resources on key growth areas.
What Comes Next
The timing is particularly significant as Microsoft gears up for the next generation of Xbox consoles. Industry experts warn that these layoffs could impact the company’s ability to innovate and compete in the gaming market.
Looking ahead, Microsoft’s strategic decisions will be closely watched by analysts and stakeholders as the company seeks to maintain its competitive edge while managing operational costs.
Photographer: Victor J. Blue/Bloomberg via Getty Images.
Wesley is Director, News at IGN. Find him on Twitter at @wyp100. You can reach Wesley at [email protected] or confidentially at [email protected].
