Microsoft has rejected claims that Xbox’s recent layoffs were intended to replace American employees with foreign workers on H-1B visas. The response came after online posts tied the company’s workforce reductions to CEO Asha Sharma’s Indian heritage.
Xbox cut 3,200 jobs during a broader restructuring that also involved the spinoff of four studios, with a fifth potentially affected by the unresolved Arkane situation. A Fox News report connected Microsoft’s layoffs with authorization to hire 2,273 employer-sponsored, non-immigrant workers through the H-1B program.
That report said Microsoft was cutting roughly 4,800 positions across the company, with most of the reductions coming from Xbox. It also cited online accusations that Sharma’s background played a role in the layoffs.
H-1B visas allow U.S. companies to hire foreign workers for certain specialized jobs. The program has become a major political flashpoint, including after a proposed $100,000 application fee was overturned by a federal court.
Microsoft says the numbers were misrepresented
Frank X. Shaw, Microsoft’s chief communications officer, addressed the claims in a post on X. He said the Xbox changes were made because the business was unhealthy and were not intended to replace employees with foreign workers.
Shaw also explained that the H-1B numbers being discussed cover Microsoft as a whole. They include visa renewals and applications for new hires, rather than positions tied specifically to Xbox, and represent a small portion of Microsoft’s overall workforce. He added that most of the affected roles were not American roles.
“Xbox is the largest employer of American workers in the gaming industry and the largest American gaming company,” Shaw wrote. He also described Sharma as an American-born, American-raised, and American-educated CEO from Wisconsin.
Sharma’s appointment has placed her at the center of Microsoft Gaming’s leadership changes. She took over after Phil Spencer’s retirement, as detailed in the report on Asha Sharma leading Microsoft Gaming.
Earlier this week, the U.S. Federal Reserve appointed Sharma to a Productivity and Jobs task force. In that role, she will help assess the economic effects of new general-purpose technologies, including artificial intelligence, and inform the Federal Reserve’s policy work.
The dispute adds another layer of public scrutiny to Xbox’s layoffs, but Microsoft’s response rejects the idea that the cuts were part of an H-1B replacement plan. Share your thoughts in the comments, and follow us on X, Bluesky, YouTube, and Instagram.
