Bloomberg: Microsoft Plans Major Job Cuts at Xbox Gaming Division

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Thick Thighs Save Lives

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Microsoft Corp. will conduct another round of major layoffs in its Xbox division next week as part of a company-wide reorganization.

Managers within Xbox are expecting substantial cuts across the entire group, according to people familiar with the plans who asked not to be identified discussing nonpublic information. The company declined to comment.

This will be the fourth big layoff at Xbox in the past 18 months, following three major cuts last year and the closure of several subsidiaries. Xbox, which produces video-game hardware and software, has been under pressure from Microsoft executives to boost profit margins since purchasing Activision Blizzard Inc. for $69 billion in a deal that closed in 2023.
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Bloomberg News earlier reported that Microsoft plans to cut thousands of jobs next week, largely in sales.

The tech giant often makes major organizational changes close to the end of its fiscal year, which concludes on June 30.
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www.bloomberg.com

Microsoft Plans Major Job Cuts at Xbox Gaming Division

The video-game division’s latest round of layoffs is expected next week
www.bloomberg.com www.bloomberg.com
 
Paywalled, sorry

https://www.bloomberg.com/news/articles/2025-06-24/microsoft-plans-major-job-cuts-at-xbox-gaming-division?accessToken=eyJhbGciOiJIUzI1NiIsInR5cCI6IkpXVCJ9.eyJzb3VyY2UiOiJTdWJzY3JpYmVyR2lmdGVkQXJ0aWNsZSIsImlhdCI6MTc1MDc3Mjc0NiwiZXhwIjoxNzUxMzc3NTQ2LCJhcnRpY2xlSWQiOiJTWUQ0VkxEV1JHRzAwMCIsImJjb25uZWN0SWQiOiJCMUVBQkI5NjQ2QUM0REZFQTJBRkI4MjI1MzgyQTJFQSJ9.iMkVuxzB6m6hT_Rpwa-NQCTCvDapSt1DaRfpnGaqUSw&leadSource=uverify wall



Oh No Fire GIF
 
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But for real though, this shit sucks man. It really does. They take on all these studios and then go through them with an indiscriminate hacksaw. I just want them to make good games man. That's it.
 
Sad to see. I feel bad for the people losing their jobs, but the writing has been on the wall for a long time now. No one should be surprised by this.
 
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If you are surprised, you are silly.. after so many stupid decisions, this is the natural outcome... problem is: we know WHO MADE these decisons will continue to do so, because they will not be affected.
 
This will be the fourth big layoff at Xbox in the past 18 months, following three major cuts last year and the closure of several subsidiaries. Xbox, which produces video-game hardware and software, has been under pressure from Microsoft executives to boost profit margins since purchasing Activision Blizzard Inc. for $69 billion in a deal that closed in 2023.
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Seems like they overestimated how much this deal would bring them. I have a feeling they thought this would be the thing to make Gamepass an actual platform and it failed to bring them the numbers. For the past 18 months they have been firing people and bringing games to every platform lol.
 
PauloRoberto said:
If you are surprised, you are silly.. after so many stupid decisions, this is the natural outcome... problem is: we know WHO MADE these decisons will continue to do so, because they will not be affected.
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Sadly it's always the employees who suffer the consequences of the retarded decisions of the leaders.
 
If it's any consolation, Phil tried to hold to his buttcheeks until the last moment. but hey, I was told Xbox's profits are yuge, they are making all the monies
 
SweetTooth said:
Activision acquisition has accelerated the death of Xbox beyond anything I imagined .. oof
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I read somewhere that once that happened all sorts of people in Microsoft leadership who didn't give a shit about Xbox started taking a closer look and not liking what they saw. That's what happens when you spend $70 billion.
 
HeisenbergFX4 said:
It sure didnt have the effect they were hoping for
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MS should have simply kept every Activision game EXCLUSIVE to Xbox, yes it will hurt the bottom line for some time but will create tremendous value for Xbox for the long run.

They could have also worked on a rival platform to steam with all these games EXCLUSIVE to them. Thats a guaraneed +5m users for CoD alone.

If there was a company that can pull such aggressive strategy, its MS with their deep pockets.
 
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RetroGamingUK said:
Where do you think the job losses are coming from?
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I won't pretend to have any sort of subject matter expertise in this area. I have a solid track record of making predictions among friends online and then being totally wrong. So much so that whatever I say will probably be the opposite of what happens. :messenger_neutral:

With that caveat:

It mentions sales people being laid off. I can't imagine Xbox has thousands of sales people. I would think that division would get hit for sure, but I think they probably have to close some studios if they're going to lay off thousands of people. Ninja Theory, Double Fine, 343 Industries, and Turn 10 seem like obvious candidates for the chopping block there. I can hear all the arguments of "they need artists making good art to add value to the Xbox brand", but I think that argument runs up against the harsh reality of corporate overlords not being willing to tolerate unprofitable areas within the business. If they can make bank selling COD skins and remasters of old games, and the other new games aren't getting it done, it's hard to see how they can keep those people on board.

I would also expect cuts to the hardware division. If they're moving to a basic PC APU that will run windows, it seems like the need for custom hardware specialists would be diminished. Similarly with the people who've been working on the Xbox OS. And how much more design & testing do they need on their controllers? Obviously none of these areas of the console have a ton of people working on them, but if they're going to outsource more of the hardware development and focus on Windows based software that runs on PCs going forward, those people probably become redundant.

I would also expect to see a lot of people in and around mid-level management to be let go.
 
People don't want to buy the system. It is what it is. Xbox is changing into a 3rd party publisher that runs a PC storefront. They're going to lose the majority of the passive 30% income from 3rd party sales. The whole division will have to shrink their footprint to get costs to match their new revenue reality.

All you can really hope for is that they keep all the devs and keep the games coming. Surface team can make hardware if they make any themselves, and keep the best people from Xbox system UI and store programming to integrate into Windows development.

You see how much staff Valve has just for their store. It's barely anyone. That's basically all they need for Xbox now, aside from the developers, publishing and marketing.
 
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