Microsoft announced it’s cutting 3% of its staff, which could mean thousands of layoffs across various teams and locations. This move follows previous rounds of job cuts, including significant hits to its gaming divisions. The news has got me thinking about what this means for Xbox and Bethesda.
According to a CNBC report, Microsoft had around 228,000 employees as of last June. If that number hasn’t changed much, 3% would translate to roughly 6,840 people losing their jobs. The company mentioned that part of the goal is to reduce layers of management and adjust the organization to stay competitive in a shifting market.
This is the most prominent layoff announcement since January 2023, when Microsoft cut about 4.5% of its workforce, around 10,000 employees. That earlier round hit the gaming side pretty hard, affecting Xbox, Bethesda, and especially 343 Industries, the studio behind Halo Infinite. Other areas like HoloLens and some engineering teams were also impacted.
Then, in January 2024, Microsoft trimmed 1,900 staff across Xbox, Bethesda, and Activision Blizzard after the acquisition. The head of Microsoft Gaming, Phil Spencer, explained that the cuts came after leadership teams aligned priorities and identified overlaps to focus on growth opportunities. He emphasized the tough but necessary decision to reduce the gaming workforce by about 1,900 roles out of 22,000 employees.
It’s unclear how many people in the gaming division will be affected by this latest 3% cut. Given the history, some teams within Xbox and Bethesda might see changes again.
Phil Spencer’s message to staff in January 2024 highlighted the difficult choices made to align the combined Microsoft Gaming and Activision Blizzard teams. He promised the leadership team would handle the process thoughtfully, but it was always uncompromising news for those affected.
What do you think about Microsoft’s latest layoff plans? Could this impact upcoming Xbox projects or the overall gaming strategy? Drop your thoughts in the comments below—I’m curious to hear your take!
