In the wake of Microsoft’s acquisition of Activision Blizzard, the company has announced further layoffs in its gaming division. The cuts primarily affect administrative and support roles, with developers mostly spared.
Phil Spencer, head of gaming at Microsoft, revealed that 650 employees would be laid off. He attributed the layoffs to necessary “team structure adjustments following the acquisition,” referring to the merger with Activision Blizzard. However, Spencer did not explicitly mention the company in his statement.
Most of the layoffs are expected to impact administrative and support staff, though a small number of developers may also be affected. Microsoft has promised to provide severance packages and assistance in finding new positions for those losing their jobs.
In a letter to employees, Spencer emphasized that “no games, devices, or experiences are being canceled today, and no studios are being closed.” The use of the word “today” suggests that future changes could still occur. This message was shared by IGN and other outlets.
Microsoft and Xbox: January 2024 layoffs
In January 2024, Microsoft had already laid off around 1,900 employees, also a result of the Activision Blizzard merger and the earlier acquisition of Bethesda. During that period, several projects were canceled, most notably Blizzard’s never-released Project Odyssey. In addition, there were changes in upper management within the studios, though no such adjustments are being made currently.
In May 2024, Microsoft shut down four Bethesda development studios. Some developers from these studios were transferred to other Microsoft teams, but there were also an unspecified number of layoffs. Notably, Arkane Austin and Tango Gameworks were affected, with the latter being acquired by South Korean publisher Krafton.