Approximately 3% of Microsoft’s workforce is allegedly set to lose their jobs.
Microsoft has revealed another round of layoffs, which might affect the gaming division. This includes Xbox, Bethesda, and the newly bought Activision Blizzard.
In continuing attempts to streamline operations and remove managerial layers, the internet giant is reportedly planning to lay off almost 7,000 workers, or about 3% of its staff, which amounts to 6,840 people. This news was reported by CNBC.
Microsoft has laid off a large number of employees three times since January 2023. Prior rounds of layoffs mostly hit engineering teams and game development studios, with notable losses at Halo Infinite’s 343 Industries and other divisions like HoloLens.
In addition, 1,900 employees from Xbox, Bethesda, and Activision Blizzard were among those let go in January 2024 as part of a round of layoffs announced by Microsoft specifically for the gaming division. Reportedly, the layoffs followed an effort to discover duplication of effort following the acquisition of Activision Blizzard and to allocate resources better to meet company objectives.
Microsoft Gaming head Phil Spencer sent a note to employees about the layoffs, explaining that the company had to decide to keep costs down in the face of wider economic difficulties. Additionally, he mentioned that Microsoft and Activision Blizzard work together to establish goals, find common ground, and agree on where to put our efforts for maximum growth. It is yet unknown how the most recent round of layoffs will impact the gaming division.
But this just goes to show how tough it is for Microsoft to reorganize its gaming operations, integrate Activision Blizzard, and weather economic uncertainty. As any manager or CEO worth their salt can tell you, every company has its unique set of goals and objectives.
Microsoft, with a market cap of over $3 trillion, could certainly afford to pay for these things. However, that’s not the case; more profits are their primary goal. Their target market valuation is $4 trillion. They need to recoup the $100 billion they’ve spent on acquisitions in the past few years. It also doesn’t emanate from their Xbox gaming branch. Reducing management levels is one of the reasons, according to one of the spokespersons. That they are seeking other strategies to achieve their operational aims is the implication.
The PlayStation studios, Electronic Arts, and Microsoft are all involved in this. Not long ago, EA startled the game industry by laying off 400 workers; a few months prior, they had laid off 700 workers, including those with strong artistic and coding skills. Plus, PlayStation shelved two first-party live-service games that were in the works.
