Microsoft announces 1,900 layoffs across Xbox and Activision Blizzard

Microsoft confirms 1,900 layoffs across its Xbox and Activision Blizzard

Microsoft has confirmed that Microsoft Gaming will be laying off around 1,900 employees. These layoffs will affect Microsoft’s Xbox, Zenimax, and Activision Blizzard segments, cutting around 8% of Microsoft Gaming’s total workforce.

These cuts come three months after Microsoft’s acquisition of Activision Blizzard. Some of Microsoft’s job cuts will come from “areas of overlap” between Microsoft Gaming and Activision Blizzard. Such layoffs are common after an acquisition. That said, Microsoft’s announced layoffs will axe 8% of Microsoft Gaming’s workforce, which means that the layoffs don’t just effect so-called “overlap” areas.

Below is a memo from Microsoft Gaming’s CEO Phil Spencer that was obtained and published by The Verge.

It’s been a little over three months since the Activision, Blizzard, and King teams joined Microsoft. As we move forward in 2024, the leadership of Microsoft Gaming and Activision Blizzard is committed to aligning on a strategy and an execution plan with a sustainable cost structure that will support the whole of our growing business. Together, we’ve set priorities, identified areas of overlap, and ensured that we’re all aligned on the best opportunities for growth.

As part of this process, we have made the painful decision to reduce the size of our gaming workforce by approximately 1900 roles out of the 22,000 people on our team. The Gaming Leadership Team and I are committed to navigating this process as thoughtfully as possible. The people who are directly impacted by these reductions have all played an important part in the success of Activision Blizzard, ZeniMax and the Xbox teams, and they should be proud of everything they’ve accomplished here. We are grateful for all of the creativity, passion and dedication they have brought to our games, our players and our colleagues. We will provide our full support to those who are impacted during the transition, including severance benefits informed by local employment laws. Those whose roles will be impacted will be notified, and we ask that you please treat your departing colleagues with the respect and compassion that is consistent with our values.

Looking ahead, we’ll continue to invest in areas that will grow our business and support our strategy of bringing more games to more players around the world. Although this is a difficult moment for our team, I’m as confident as ever in your ability to create and nurture the games, stories and worlds that bring players together.

Phil

Mike Ybarra, the now former president of Blizzard, has announced that he will be leaving the company. Microsoft reportedly plans to name a new president for Blizzard next week.

In a statement on Twitter/X, Ybarra said the following.

Having already spent 20+ years at Microsoft and with the acquisition of Activision Blizzard behind us, it’s time for me to (once again) become Blizzard’s biggest fan from the outside.

I want to thank everyone who is impacted today for their meaningful contributions to their teams, to Blizzard, and to players’ lives. It’s an incredibly hard day and my energy and support will be focused on all those amazing individuals impacted – this is in no way a reflection…

— Mike Ybarra (@Qwik) January 25, 2024

At this time it is unknown how Microsoft’s layoffs will impact Microsoft Gaming as a whole. Microsoft Gaming is a large organisation that is in control of a huge number of game studios. Microsoft appears to be handling these layoffs in a tactical way, hoping to minimise the impact of these cuts on games in development. Even so, the announcement of these layoffs will certainly harm morale across the entire organisation. That’s something that will have an impact on Microsoft Gaming’s many projects.

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