Microsoft lays off 650 staff at Xbox gaming division

Microsoft is laying off 650 more people from the staff of its Xbox Games division, according to new reports. Phil Spencer allegedly confirms the number in a memo sent out to staff today, clarifying that the jobs are “mostly corporate and supporting functions” and that they were cut in order to set the business up for long-term success. This is the second major round of layoffs from the company, and puts the total number of cut jobs for Microsoft in 2024 at about 2,550.

GameFile and Bloomberg both reported on the layoffs, while IGN obtained a copy of Spencer’s memo to staff. In the latter, Spencer says, “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. Separately, as part of running the business, there are some impacts to other teams as they adapt to shifting priorities and manage the lifecycle and performance of games.”

The Xbox games division has suffered several such cuts and layoffs so far this year. In January, Microsoft cut 1,900 jobs across the Xbox, Bethesda and Activision Blizzard teams. In May, Xbox shut down four studios — Tango Gameworks (which was later acquired and reopened by Krafton), Arkane Austin, Alpha Dog Games and Roundhouse Studios (which was folded into ZeniMax Studios Online).

All of these layoffs were made following Microsoft’s acquisition of Activison Blizzard King. In January, Spencer said the leadership had identified areas of overlap and “ensured that we’re all aligned on the best opportunities for growth.” Similarly, in this round of layoffs, he explicitly refers to the acquisition saying, the company was “aligning our post-acquisition team structure.” In addition to clarifying which roles were being cut, Spencer also added, “No games, devices or experiences are being cancelled and no studios are being closed as part of these adjustments today.”

These layoffs are the latest in 2024, which has seen around 12,000 layoffs so far (counting these layoffs from Microsoft) according to VideoGameLayoffs.com. Other major layoffs of the year include Unity, Bungie, Sony, Eidos Montreal, Electronic Arts, Take-Two Interactive and Riot Games, among many others.

In a statement, the Communications Workers of America union said, “Microsoft’s decision to lay off 650 video game workers is an extremely disappointing move from one of the world’s largest and most profitable corporations. This news comes just after Sony Interactive Entertainment subsidiary Bungie announced 220 layoffs in late July. While none of those who are losing their jobs are represented by CWA, we understand how devastating layoffs are to the workers and their families.”

“Every worker deserves a voice on the job and a say over the impact of job cuts,” said Samuel Cooper, senior producer at World of Warcraft and member of WoWGG-CWA, in a statement. “While we would hope that a company like Microsoft with $88 billion in profits last year could achieve ‘long term success’ without destroying the livelihoods of 650 of our colleagues, heartless layoffs like these have become all too common. We stand in solidarity with everyone who lost their job today and encourage all video game workers to join with us and form unions so we can protect each other.”

While union representation does not always protect against layoffs, collective bargaining does give workers a voice in the policies that affect them, including how layoffs are handled, the CWA said.