Microsoft to lay off nearly 9,000 employees, Gaming vertical to hit hard

SAN FRANCISCO — Microsoft is laying off 4 per cent of its workforce, or around 9,000 employees, in yet another round of job cuts this year, reports said on Wednesday.

According to The Seattle Times, employees in Microsoft’s Xbox division, known as Microsoft Gaming, are being hit hard by these layoffs.

“To position Gaming for enduring success and allow us to focus on strategic growth areas, we will end or decrease work in certain areas of the business and follow Microsoft’s lead in removing layers of management to increase agility and effectiveness,” said Xbox leader Phil Spencer in a message to the team.

The fresh job cuts come less than two months after Microsoft announced it was laying off more than 6,000 employees, followed by an additional 305 reductions in early June.

Microsoft laid off 1,900 Activision Blizzard and Xbox employees in January 2024, followed by several game studio closures and job losses in May, and 1,000 job losses from its HoloLens and Azure cloud teams in June.

Microsoft also laid off 650 more Xbox employees in September, as part of a restructuring related to the company’s acquisition of Activision Blizzard, reports The Verge.

According to Xbox boss Phil Spencer, “these changes come at a time when we have more players, games, and gaming hours than ever before”.

“Our platform, hardware, and game roadmap have never looked stronger. The success we’re seeing currently is based on tough decisions we’ve made previously. We must make choices now for continued success in future years and a key part of that strategy is the discipline to prioritize the strongest opportunities,” he told employees.

“We will protect what is thriving and concentrate effort on areas with the greatest potential, while delivering on the expectations the company has for our business. This focused approach means we can deliver exceptional games and experiences for players for generations to come,” Spencer added.