Microsoft has just announced another round of layoffs in its gaming division. This time the company is cutting 650 jobs primarily in corporate and support roles. Chief Phil Spencer shared this news in a memo to staff.
Spencer emphasized that no games, devices, or studios were being affected directly, framing the layoffs as part of a long-term restructuring plan for the company’s future success. These layoffs are a continuation of a series of cuts that have impacted over 2,500 employees since the acquisition of Activision Blizzard in 2023.
The Layoffs Are Related to the Activision Acquisition, According to Phil Spencer’s Memo
The layoffs are part of Microsoft’s long-term strategy to realign its workforce following its $68.7 billion acquisition of Activision Blizzard in October 2023. In his memo, Spencer explained that these cuts are necessary for the company to ensure sustainable growth and continue supporting its studio teams and business units.
He also acknowledged the emotional toll these layoffs take, recognizing the contributions of those affected and highlighting the company’s efforts to provide severance packages, extended healthcare, and job placement services.
Microsoft to cut 650 more gaming jobs – mostly corporate and supporting functions (reportedly at Activision Blizzard)
“No games, devices or experiences are being cancelled and no studios are being closed as part of these adjustments today.”https://t.co/NajrrdwVG5 pic.twitter.com/yAS9kdoW5a
— Wario64 (@Wario64) September 12, 2024
Spencer’s message conveyed empathy while explaining the business rationale behind the decisions. He assured staff that the corporate and support teams would now be better positioned for sustainable growth, which would, in turn, help studio teams continue delivering games at a high standard.
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The video game industry at large has faced an unprecedented number of layoffs in 2024. as major gaming companies have faced financial difficulties despite high overall revenue in the gaming market. Earlier in the year, Microsoft made significant cuts, including closing down prominent studios like Arkane Austin and Tango Gameworks.
What Direction Is The Company Planning On Taking?
For Microsoft, these layoffs come at a time when the company is also navigating shifting priorities within its gaming business. While its consoles have struggled in recent financial quarters, the company has expanded its presence in other areas, such as cloud gaming and multiplatform releases.
The long-term vision for the company’s gaming division includes expanding its Game Pass subscription service. The acquisition of Activision Blizzard has allowed Xbox to strengthen its portfolio, with top-selling franchises like Call of Duty and Diablo now under its belt.
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Microsoft continues to realign its business, and Spencer remains optimistic about the future. Looking ahead, the company is preparing to launch new titles, including Call of Duty: Black Ops 6 and Indiana Jones and the Great Circle.
While the layoffs are a difficult reality, they reflect the broader shifts happening across the video game landscape as companies adapt to changing market conditions and player expectations.
What do you think the future holds for the gaming industry? Let us know your thoughts in the comments!
