Microsoft began laying off around 6,000 employees this Tuesday, nearly 3% of its workforce, as the company continues to heavily invest on artificial intelligence. The cuts will affect teams all across the tech giant, and it appears that Xbox won’t be spared from further losses.
The news came as a shock many, especially since Microsoft continues to post strong financial results. A company spokesperson said the move was necessary to ensure Microsoft’s long-term success in a constantly evolving market.
Uncertainty looms over Xbox
Microsoft confirmed that the layoffs would impact divisions at every level and in all regions.
Company spokesperson Pete Wootton stated that the cuts stem from essential organizational changes. He emphasized that the layoffs are not linked to individual performance but are instead aimed at streamlining management layers.
“We continue to implement organizational changes necessary to best position the company for success in a dynamic marketplace,” he said.
Just days ago, Microsoft CFO Amy Hood hinted at possible executive-level cuts. Reports indicate the new round of layoffs will impact global operations at all levels, although Xbox’s specific fate remains unconfirmed.
Previous layoffs hit Xbox hard
Xbox has already weathered the storm of layoffs, and it hasn’t been easy. At the start of 2024, Microsoft laid off 1,900 employees, and the cuts were felt particularly in Xbox and Activision Blizzard, just after the companies merged.
It was a tough blow, but the wave of layoffs continued. In May, the tech giant chose to close Arkane Austin and Tango Gameworks, the creators of Redfall and Hi-Fi Rush.
Then, in September, another 650 Xbox staff members lost their jobs as part of ongoing restructuring. As the year drew to a close, Microsoft announced a final round of 1,000 layoffs, but while divisions like HoloLens and Azure were heavily impacted, Xbox somehow escaped the worst.