Microsoft has announced another major wave of job cuts, confirming the layoff of 9,100 employees—about 4% of its global workforce. The cuts significantly impact Microsoft’s Xbox division and broader gaming group, with multiple studios and teams affected.
Xbox, ZeniMax, and King Studios Among Those Affected
According to reports from The Seattle Times and Bloomberg, the layoffs are particularly severe within Microsoft Gaming. This includes teams at ZeniMax, the creators of Elder Scrolls and Fallout, and King, the developer behind Candy Crush, which is cutting about 10% of its workforce—roughly 200 people.
The restructuring has also affected Turn 10 Studios, the team behind Forza Motorsport, where over 70 jobs have been lost. Additionally, Microsoft has reportedly cancelled development on titles such as Perfect Dark and Everwild, resulting in the closure of The Initiative, the studio responsible for Perfect Dark.
Phil Spencer: “We Must Prioritize the Strongest Opportunities”
In an internal memo to staff, Xbox chief Phil Spencer emphasized the need to streamline operations and focus on strategic growth:
“To position Gaming for enduring success… we will end or decrease work in certain areas of the business and follow Microsoft’s lead in removing layers of management to increase agility and effectiveness.”
Spencer acknowledged the emotional toll of the layoffs, expressing gratitude for the “time, energy, and creativity” of the impacted employees. He reaffirmed Microsoft’s commitment to delivering exceptional gaming experiences and protecting high-potential projects.
A Year of Heavy Cuts Across Microsoft Divisions
These layoffs are the latest in a series of workforce reductions at Microsoft:
- January 2024: 1,900 jobs lost at Activision Blizzard and Xbox
- May 2024: Studio closures and additional job losses
- June 2024: Over 1,000 layoffs in HoloLens and Azure
- September 2024: 650 more roles cut in Xbox restructuring
- June 2025: Additional 305 job cuts before this current round
Support for Affected Employees
Microsoft has confirmed that HR teams are providing severance packages, healthcare benefits, and job placement support. Impacted employees are also encouraged to apply for other open positions within Microsoft Gaming, with priority given to internal applicants.
The Microsoft Xbox layoffs highlight a pivotal moment in the company’s gaming strategy. As Microsoft refocuses on high-growth opportunities, these decisions though difficult reflect a long-term vision for agility, innovation, and platform dominance in a competitive gaming landscape.
