Kalani Tharanga, JadeTimes Staff
D.W.G. Kalani Tharanga is a Jadetimes news reporter covering Political Blogs.
Microsoft, the owner of Xbox, is set to cut around 650 employees from its gaming division following its massive $69 billion (£54.3 billion) merger deal with Activision Blizzard. The layoffs will primarily affect staff working in corporate and support roles globally. This is the latest in a series of cuts, following 1,900 job losses earlier this year, and the closure of four studios in May.
Despite the layoffs, Xbox chief Phil Spencer assured employees in a memo that no games, studios, or projects would be canceled as a result of the cuts. The decision comes as part of Microsoft's effort to reorganize its gaming business post acquisition and ensure long term success. While no specific games or studios are impacted, other teams within the company may feel the effects as they adapt to changing priorities and game performance management.
Reshaping the Gaming Industry: Microsoft and the Broader Impact
The gaming industry has faced significant layoffs in the past two years, driven by post pandemic shifts and the surge of acquisitions and investments made during a period of record profits and player growth. Other industry giants, such as Sony, Riot Games, and Epic Games, have also let go of hundreds of employees. Microsoft, in particular, drew criticism earlier this year for closing renowned studios like Arkane Austin and Tango Gameworks.
Although Xbox saw increased gaming revenues, largely due to its acquisition of Activision Blizzard, hardware sales have declined. The company is now focused on expanding its software sales, alongside launching new games from franchises like Call of Duty and Indiana Jones. Despite some recent fan discontent over price hikes for its Game Pass service and plans to release certain games on rival consoles, Xbox's June showcase was highly praised, featuring a strong lineup of upcoming titles.
