It’s official now: we’ve learned the full extent of the wave of layoffs carried out by Microsoft this week. Suffice it to say right away that the company will be changed forever.
Asha Sharma explained in a post on X that 15% of the Xbox division’s workforce, which amounts to approximately 3,200 people, will be laid off by the end of the current fiscal year. It’s worth noting that 1,600 people are leaving as of today. The American company has also decided to sell four of its studios.
Double Fine Productions (Psychonauts) and Compulsion Games (South of Midnight) will regain their independence. Ninja Theory (Hellblade) and Undead Labs (State of Decay) have already found a buyer, though we do not yet know who it is. Senua and State of Decay 3 will be released under this new structure. Arkane Lyon (Deathloop), meanwhile, is looking for a buyer.
Activision, Bethesda/ZeniMax, Blizzard, King, Mojang, and other Xbox Game Studios are seeing staff departures. However, no internally developed games that have been publicly announced have been canceled. Mojang and King are now directly under Sharma’s leadership.
Microsoft is also changing the way it operates by reducing the “layers of management” that could sometimes number as many as 14 just to make a single decision. From now on, these layers will not exceed five or even three, when possible. The Xbox divisions (content, hardware, services, etc.) will also operate as a unified unit under the leadership of Helen Chiang, the new chief operating officer. Her goal will be to unify Xbox’s operations under a single operational model.
That being said, Asha Sharma wanted to end on a more positive note.
“These changes are about a bigger future for XBOX, not a smaller one. The next decade of gaming will be larger, more global, and more creative than anything we’ve seen before. This year, we’ll invest as much in XBOX as we ever have, but we’ll invest with greater focus, greater discipline, and greater clarity, all in service of making XBOX where the world plays and creates.
I want XBOX to be one of the few companies that entertains more than a billion people each day and gives everyone the opportunity to create and connect. I know we can achieve this goal. XBOX has many of the most beloved franchises in entertainment history, talented studios around the world, and we will return to growth in 2027.
History is full of companies that mistake longevity for inevitability. We will not be one of them.”
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Author: 360 Technology Group
