More Layoffs Planned for Microsoft Gaming

More layoffs coming to Microsoft Gaming division. Credit: Microsoft

Microsoft plans to eliminate 650 roles from its Microsoft Gaming division, according to a new report from The Verge. The news was shared with employees of the company this week in an internal memo to employees from Microsoft Gaming CEO Phil Spencer. The layoffs will focus on “corporate and supporting” roles within the division, according to Spencer.

Specific details on which divisions might be affected were not disclosed, but it could include all of its wholly owned game studios including Call of Duty maker Infinity Ward, its Xbox division, World of Warcraft and Overwatch League 2 maker Blizzard Entertainment, what remains of its esports operations (Call of Duty League), and many other studios.

Earlier this year, Microsoft cut approximately 1,900 Activision Blizzard and Xbox employees, and closed several studios including Redfall developer Arkane Austin. Spencer did say that these layoffs will not affect any ongoing game projects currently in the works and that the company had no plans to close any additional studios.

Following nearly two years of challenges in closing its $68.7 billion USD acquisition of Activision Blizzard in October, that transaction continues to have an impact on Microsoft’s workforce, as the company continues to make its workforce leaner and remove what it might consider duplicate roles or responsibilities. Critics say these cuts are part of the company’s aim to cut costs and improve revenues for shareholders.

Spencer’s memo to employees can be read in its entirety below:

For the past year, our goal has been to minimize disruption while welcoming new teams and enabling them to do their best work. As part of aligning our post-acquisition team structure and managing our business, we have made the decision to eliminate approximately 650 roles across Microsoft Gaming — mostly corporate and supporting functions — to organize our business for long term success.

I know that this is difficult news to hear. We are deeply grateful for the contributions of our colleagues who are learning they are impacted. In the US, we’re supporting them with exit packages that include severance, extended healthcare, and outplacement services to help with their transition; outside the US packages will differ according to location. 

With these changes, our corporate and supporting teams and resources are aligned for sustainable future growth, and can better support our studio teams and business units with programs and resources that can scale to meet their needs. Separately, as part of running the business, there are some impacts to other teams as they adapt to shifting priorities and manage the lifecycle and performance of games. No games, devices or experiences are being canceled and no studios are being closed as part of these adjustments today.

Throughout our team’s history, we have had great moments, and we have had challenging ones. Today is one of the challenging days. I know that going through more changes like this is hard, but even in the most trying times, this team has been able to come together and show one another care and kindness as we work to continue delivering for our players. We appreciate your support as we navigate these changes and we thank you for your compassion and respect for each other.

Phil