Tech layoffs: Microsoft to cut hundreds of jobs in Xbox Games unit

The roles that Microsoft will be eliminating in its gaming division are “mostly corporate and supporting functions”

Microsoft Corp. is cutting 650 jobs in the Xbox division, Bloomberg reported, adding that this is the third of such layoffs this year as the company tries to reduce costs and integrate its $69 billion acquisition of Activision Blizzard Inc.

A Microsoft logo is seen on an office building in New York City, US. (Reuters)

The roles to be eliminated are in “mostly corporate and supporting functions,” the report cited a memo sent to the staff by Microsoft Gaming CEO Phil Spencer on Thursday, September 12, 2024.

However, “No games, devices or experiences are being cancelled and no studios are being closed as part of these adjustments today,” Bloomberg quoted the memo as saying.

This comes after Microsoft cut as much as 1,900 jobs in January this year. A lot of those jobs were from Activision units and studios.

In May, Microsoft shut down four studios which it acquired as a part of its $7.5 billion purchase of ZeniMax.

This is not just a phenomenon seen in Microsoft alone but is something happening to the gaming industry itself in general. Sony Group Corp., Take-Two Interactive Software Inc. and Electronic Arts Inc have all cut jobs and shut down marquee projects, according to the report.

Sony even axed its big-budget multiplayer shooter Concord only two weeks after its release, in a move displaying little patience to the game's slow start.