Microsoft Cuts 650 Jobs in Xbox Division Amid Gaming Industry Restructuring

Xbox layoffs: Why Microsoft has told its gaming unit to cancel posting on social media - Times of India

Microsoft is making another round of job cuts, this time affecting around 650 employees in its gaming division. The layoffs follow earlier cuts of 1,900 positions and the closure of several game studios. Xbox head Phil Spencer informed staff via an internal memo, clarifying that the layoffs are primarily related to the Activision Blizzard acquisition and won't impact any games, devices, or existing experiences.Reportedly, this wasn't the only message sent to Microsoft's gaming unit staff. According to The Verge's Tom Warren, Microsoft has told the social media handlers of Xbox to "go dark" to avoid a repeat of "feel the burn" Xbox controller announcement during the May announcement of closing four game studios. "I understand that Microsoft is even going dark on social media today, instructing Xbox employees to cancel scheduled posts. Last time Microsoft announced Xbox job cuts, it still launched a fiery-themed controller with a 'feel the burn' slogan that generated backlash both publicly and inside of Microsoft. Lots of employees expressed their dissatisfaction over the Xbox controller announcement mistake in posts on Microsoft's employee-only messaging board at the time," he shared a screenshot on X. What happened during "feel the burn" Xbox controller launch In May, Xbox announced that it is closing four of Bethesda's subsidiary studios: Arkane Austin, Tango Gameworks, Alpha Dog Studios, and Roundhouse Games. Soon after the 'major shock' to many gamers, the company made an announcement of its Fire Vapour Special Edition controller with the tagline, "Feel the burn today." This reportedly did not go down well with fans with several of them pointing out the 'bad timing' of the announcement. People went on to ask if Microsoft was trolling its own employees. After 'feeling the heat', Microsoft changed the tagline. The TOI Tech Desk is a dedicated team of journalists committed to delivering the latest and most relevant news from the world of technology to readers of The Times of India. TOI Tech Desk's news coverage spans a wide spectrum across gadget launches, gadget reviews, trends, in-depth analysis, exclusive reports and breaking stories that impact technology and the digital universe. Be it how-tos or the latest happenings in AI, cybersecurity, personal gadgets, platforms like WhatsApp, Instagram, Facebook and more; TOI Tech Desk brings the news with accuracy and authenticity.

Tech layoffs: Microsoft cuts 650 jobs in Xbox division, CEO Phil Spencer says, "I know that it is difficult...." - Times of India

Microsoft announced on Thursday that it will lay off approximately 650 employees in its gaming division, primarily affecting corporate and support functions. This move comes as part of the company's efforts to streamline operations following its $68.7 billion acquisition of Activision Blizzard last year. Xbox chief Phil Spencer revealed the layoffs in an internal memo, stating, "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 organise our business for long term success." The cuts are primarily focused on integrating teams and resources after the Activision Blizzard merger.Spencer emphasised that "no games, devices or experiences are being cancelled and no studios are being closed as part of these adjustments today." This round of layoffs follows previous cuts in January 2024, when Microsoft eliminated 1,900 positions across Activision Blizzard and Xbox. The gaming industry has faced significant challenges in the past year, with major players like Sony, Take-Two Interactive, and Electronic Arts also implementing job cuts and project cancellations. For affected employees in the United States, Microsoft will provide exit packages including severance, extended healthcare, and outplacement services. International employees will receive location-specific support. Spencer acknowledged the difficulty of the situation, stating, "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." The restructuring aims to align corporate and supporting teams for sustainable future growth, enabling better support for studio teams and business units. Spencer added, "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." The TOI Tech Desk is a dedicated team of journalists committed to delivering the latest and most relevant news from the world of technology to readers of The Times of India. TOI Tech Desk's news coverage spans a wide spectrum across gadget launches, gadget reviews, trends, in-depth analysis, exclusive reports and breaking stories that impact technology and the digital universe. Be it how-tos or the latest happenings in AI, cybersecurity, personal gadgets, platforms like WhatsApp, Instagram, Facebook and more; TOI Tech Desk brings the news with accuracy and authenticity.

Microsoft lays off 650 videogame workers

Microsoft is laying off approximately 650 employees from its videogame business, the tech giant's latest move to cut costs after its $75 billion acquisition of Activision Blizzard last year. The layoffs affect mostly workers in corporate and support roles and are being done to "organize our business for long term success," said Phil Spencer, chief executive of Microsoft Gaming, in a company email Thursday reviewed by The Wall Street Journal. No studios will be closed, nor will any games, devices or experiences be canceled, he said. Microsoft's game-division layoffs are part of a significant downsizing in the global games industry. While demand for interactive entertainment shot up during the pandemic -- following decades of mostly steady growth -- consumer spending declined in 2022 and has rebounded only modestly since then. The move also comes as Microsoft has been investing heavily in artificial intelligence, including more than $13 billion in funding for ChatGPT-maker OpenAI. The tech giant said it spent $19 billion on capital expenditures and equipment in the three months that ended in June. The figure is the same amount the company spent in 2019 for the entire year. The gaming-division cuts Thursday follow the Xbox maker's decision to let go of roughly 1,900 workers from the unit at the start of the year and the closure of three of its studios in May. In January 2023, Microsoft laid off 10,000 employees across all of its businesses, including Xbox personnel. The company then gained around 10,000 employees with the October acquisition of Activision, the biggest deal in its history. So far this year, game companies overall have let go more than 11,500 employees, according to an online tally of termination announcements and news reports compiled by Farhan Noor, a technical artist in California. That figure compares with 10,500 in all of 2023 and 8,500 in 2022. Microsoft doesn't break out game-related revenue, but analysts and researchers say its Xbox machines have long trailed sales of Sony Group's PlayStations and Nintendo's Switch and other consoles. Game software and accessories sales typically correlate with demand for game hardware. To catch up with its rivals, Microsoft has been working to increase the number of subscribers to its Game Pass service, which gives users access to several hundred games, which can be streamed to consoles, PCs, smartphones and tablets. The company last disclosed in February that the number of subscribers had reached 34 million. In July Microsoft raised the price of Game Pass. A major test of Microsoft's strategy with Game Pass will come in late October, when Microsoft has said it will release Activision's next Call of Duty game on the service the same day it goes on sale a la carte. The move is risky because consumers could end up paying Microsoft less for the new installment of the shooter series -- one of the most successful entertainment properties ever -- than it would have made with the traditional approach of only selling it outright. Write to Sarah E. Needleman at Sarah.Needleman@wsj.com

Microsoft Cuts 650 Xbox Jobs Amid Restructuring Following Activision Blizzard Deal: Report - Microsoft (NASDAQ:MSFT)

Microsoft MSFT has reportedly laid off 650 employees in its gaming division, months after the company laid off 1,900 employees following its $68.7 billion acquisition of Activision Blizzard. What Happened: The layoffs were announced by Xbox chief Phil Spencer in an internal memo, reported Bloomberg. The cuts follow Microsoft's recent $68.7 billion acquisition of Activision Blizzard and come months after the company laid off 1,900 employees in the same division. Spencer emphasized that no games, devices, or experiences are being canceled, and no studios are closing as part of these layoffs. MSFT did not immediately respond to Benzinga's request for comment. "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," Spencer said in an internal memo, according to the report. See Also: Groq To Deploy AI In Saudi Arabia With Aramco, Aims To Match 2023 Microsoft-OpenAI Capacity By 2025 Microsoft is offering exit packages, including severance, extended healthcare, and outplacement services to affected employees in the U.S., with varying packages for those outside the U.S. Subscribe to the Benzinga Tech Trends newsletter to get all the latest tech developments delivered to your inbox. Why It Matters: The recent layoffs are part of a broader restructuring within Microsoft's gaming division, which began earlier this year as part of Microsoft's strategy to integrate the new teams from Activision Blizzard and streamline operations. This move affected about 8% of its overall gaming workforce, which stands at approximately 22,000 employees. In July, Microsoft executed another round of layoffs, impacting various teams and regions. Although the company did not disclose the exact number of employees affected, it was part of ongoing organizational adjustments. The layoffs come on the heels of Microsoft's acquisition of video game giant Activision Blizzard in October. This approval was secured after Microsoft agreed to sell Activision's game streaming rights to Ubisoft Entertainment. Price Action: Microsoft's shares closed 2.2% up at $423.33 on Wednesday. In premarket trading on Thursday, the stock was marginally up by 0.04% at the time of writing, according to Benzinga Pro data. Check out more of Benzinga's Consumer Tech coverage by following this link. Read Next: Apple Watch Upgrade A Downgrade? Top Analyst Says Many Missed This Crucial Information During 'Glowtime' Photo courtesy: Shutterstock Market News and Data brought to you by Benzinga APIs

Microsoft to trim 650 jobs in Xbox unit - report (NASDAQ:MSFT)

Microsoft (NASDAQ:MSFT) is reportedly trimming 650 jobs in its Xbox unit, as the company looks to keep its expenses in check. The roles that are expected to be cut are mostly in corporate and supporting functions, Bloomberg reported, citing a memo sent to the staff by Xbox chief Phil Spencer on Thursday. The memo, seen by Bloomberg, added no games, devices or experiences would be canceled, and no studios will close. In January, Microsoft (MSFT) laid off 1,900 employees at its gaming division, affecting roles at Activision Blizzard, Xbox, and Zenimax. Microsoft had closed its $69 billion acquisition of Activision Blizzard in October 2023, after a lengthy battle with U.S. and UK regulators. The company had also allegedly planned to let go of hundreds of employees from its Azure cloud division in June. Just as in 2023, layoffs have hit the video game industry in 2024. In January, Tencent's (OTCPK:TCEHY) (OTCPK:TCTZF) Riot Games announced it was laying off 530 employees, or 11% of its workforce. In early January, Unity (U) announced a 25% reduction in workforce, while Amazon's (AMZN) live-streaming site Twitch announced plans to cut about 35% of its workforce. More on Microsoft Microsoft Corporation (MSFT) Goldman Sachs Communacopia + Technology Conference (Transcript) Prediction: Microsoft Azure To Reach $200 Billion In Revenue By 2028 I Sold All My Microsoft Shares, OpenAI Edge Fading Away OpenAI reportedly in talks for $6.5B in funding at a $150B valuation Microsoft CTO hints at new 'super important' AI product emerging