Xbox confirms mass layoffs across gaming studios

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Microsoft is initiating job cuts within its Xbox gaming unit, affecting teams not only in Europe but also globally, as part of ongoing organizational changes.

Starting on July 2, just post the conclusion of Microsoft’s financial year, adjustments commenced. An internal communication from Xbox leader Phil Spencer verified this move, indicating that the organization would either discontinue or scale back operations in specific business sectors, as they reorient their attention towards longer-term objectives.

In the memo, Spencer explained to the team: “We’re working on ensuring our strategy, goals, and resources are aligned, so we can thrive in the upcoming era of gaming. This involves shifting focus for some projects and teams, all with the aim of supporting our strategic objectives.

Candy Crush’s King among those affected by layoffs

Approximately 200 employees at King, creators of the popular game Candy Crush, have been let go according to Bloomberg’s reports. This accounts for about 10% of their European workforce. Similarly, staff reductions were implemented in various other regions of Xbox, including ZeniMax. For now, it seems that only non-development teams are affected, but further cuts are anticipated.

Despite no game studios being closed down or active projects being scrapped, the recent layoffs suggest a major change in how Microsoft is handling its expanding collection of studios. Phil Spencer stressed that the company will persist in funding areas that will expand their business, cater to players, and assist creators. This focus is part of a broader approach that prioritizes operational efficiency and long-term viability.

These recent reductions continue a trend that began earlier in the year. Back in May, Microsoft announced job cuts affecting over 6,000 positions across their engineering and development departments. The layoffs in July represent another significant reduction, and indications are that the overall impact may increase; US offices will learn more details later today.

So far, Microsoft hasn’t disclosed the exact number of positions affected this month. However, it’s clear that their main concentration is on reorganizing sectors within the Xbox division, specifically in publishing, business support, and regional management.

Despite the reductions, Spencer emphasizes that Xbox isn’t retreating from its aspirations. In his recent communication to staff, he stated, “We will persist in crafting exceptional games, fostering unique experiences, and connecting with players across various platforms. Our purpose remains unaltered.

As a gamer putting it in my words, Microsoft shared a statement about the recent job cuts, saying: “We’re making changes to our organization and team structure to ensure we thrive in this ever-changing gaming landscape.

If more layoffs are announced, we will update this article.

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2025-07-02 16:48