Microsoft lays off 1,900 employees from its gaming division

Microsoft today announced that it is laying off around 1900 employees from its gaming division which had around 22,000 employees. Xbox, ZeniMax and Activision Blizzard employees were affected as part of these lay offs. Also, as part of the layoffs, Blizzard Entertainment President Mike Ybbara is leaving the company. It is important to note that Mike was part of Xbox team for over 20 years.

Microsoft Gaming CEO Phil Spencer sent the following memo to his employees announcing the lay offs.

It’s been a little over three months since the Activision, Blizzard, and King teams joined Microsoft. As we move forward in 2024, the leadership of Microsoft Gaming and Activision Blizzard is committed to aligning on a strategy and an execution plan with a sustainable cost structure that will support the whole of our growing business. Together, we’ve set priorities, identified areas of overlap, and ensured that we’re all aligned on the best opportunities for growth.

As part of this process, we have made the painful decision to reduce the size of our gaming workforce by approximately 1,900 roles out of the 22,000 people on our team. The Gaming Leadership Team and I are committed to navigating this process as thoughtfully as possible. The people who are directly impacted by these reductions have all played an important part in the success of Activision Blizzard, ZeniMax and the Xbox teams, and they should be proud of everything they’ve accomplished here. We are grateful for all of the creativity, passion and dedication they have brought to our games, our players and our colleagues. We will provide our full support to those who are impacted during the transition, including severance benefits informed by local employment laws. Those whose roles will be impacted will be notified, and we ask that you please treat your departing colleagues with the respect and compassion that is consistent with our values.

Looking ahead, we’ll continue to invest in areas that will grow our business and support our strategy of bringing more games to more players around the world. Although this is a difficult moment for our team, I’m as confident as ever in your ability to create and nurture the games, stories and worlds that bring players together.

Phil.

The layoffs at Microsoft’s gaming division are a major blow to the industry and the fans of Xbox, ZeniMax and Activision Blizzard. Microsoft has not given any clear reason for the layoffs, but some analysts speculate that it could be due to the rising costs of game development, the fierce competition from other platforms, or the shift to cloud-based gaming. Whatever the case, the layoffs have left many gamers and developers wondering about the future of Microsoft’s gaming division and its beloved franchises.