Microsoft plans ‘substantial’ layoffs at Xbox gaming division

The job cuts at Xbox are expected to impact several teams and also affect employees working in Microsoft’s global sales operations

Hyderabad: Microsoft is planning to lay off a ‘substantial’ number of employees from its Xbox division as part of a company-wide restructuring exercise. The company is likely to announce the layoffs early next week, just before the end of its fiscal year on June 30, according to reports.

Although the exact number of job losses remains unclear, the layoffs will impact several teams and may also affect employees working in Microsoft’s global sales operations, according to a Bloomberg report.

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The Xbox division oversees Microsoft’s gaming consoles, game development studios, and digital services, including Game Pass.

This could be the fourth major layoff at the company in the past 18 months. In May, the company announced a headcount reduction affecting 6,000 employees — roughly 3 per cent of its global workforce.

The tech giant has reportedly been under severe pressure since it acquired Activision Blizzard in 2023 for USD 69 billion. In January 2024, Microsoft fired 1,900 employees at Activision Blizzard and Xbox, and again cut another 650 jobs in its Xbox gaming unit in September.

As of June 2024, Microsoft had 2.28 lakh employees worldwide, with around 45,000 people working in sales and marketing roles.

Microsoft CEO Satya Nadella had earlier said that the recent layoffs were not linked to employee performance but due to organisational restructuring. Addressing staff, Nadella said the layoffs were necessary to realign teams in accordance with Microsoft’s evolving priorities, particularly its growing focus on artificial intelligence.