- Microsoft will carry out its fourth major round of layoffs in Xbox in 18 months, affecting thousands of employees and various areas of the division.
- The restructuring comes as the company faces pressure to improve profitability following its multi-billion-dollar acquisition of Activision Blizzard in 2023.
- Xbox is expected to cease operations in some Central European regions to coincide with the end of the company's fiscal year.
- The measures include the closure of studios and the reorganization of development, sales, and distribution teams.
The division of video games Microsoft's Xbox faces a new bout of job uncertainty following the confirmed arrival of a massive round of layoffs that promises to affect a significant portion of its workforce. After months of rumors and leaks from media outlets such as Bloomberg and The Verge, various sources have agreed that Next week, the fourth major adjustment within Xbox in just a year and a half will be implemented., aiming at a worrying situation in the video game industry.
Since 2024, Xbox has been hit by successive waves of staff cutsThis year alone, the brand has suffered layoffs on three previous occasions and has closed several studios and subsidiaries linked to the world of video games. According to internal sources cited in the reports, Microsoft's pressure to capitalize on the purchase of Activision Blizzard for 69.000 billion dollars forces the company to look for a more efficient structure and to try to improve its profit margins, mainly resorting to cuts in human resources.
Four major layoffs in just 18 months and restructuring at all levels
The latest news highlights that the cuts will not only affect middle management and executive positions, but will impact various Xbox teams.: from development and sales, through distribution, to those areas that work on the launch of future consoles. Several reports indicate that the Restructuring coincides with the end of Microsoft's fiscal year, which ends on June 30, which would explain the timing of these layoffs.
So far this year, Microsoft has laid off thousands of gaming employees, highlighting the elimination of 1.900 positions in January, another 650 in September, and more than 6.000 in May. In addition, the company decided close relevant studies such as Tango Gameworks (creator of Hi-Fi Rush) or Arkane Austin (responsible for Redfall), decisions that have generated discontent among workers and fans.
Cessation of operations in Central Europe and internal tensions
The reorganization at Xbox is not limited to North America or its internal studios.Several sources indicate that Xbox will stop working in some regions of Central Europe, which would affect countries such as Germany, Austria, Switzerland, Poland, Hungary, the Czech Republic, and Slovakia. Although the exact scope of this suspension has not yet been specified, there is speculation that it could affect both the availability of the console and the distribution of games and services in these markets.
In parallel to the layoffs in the video game area, Microsoft is also reportedly planning additional adjustments to its sales divisions and other corporate departments.This downsizing strategy is in line with the company's usual pattern, which typically carries out major restructurings before the end of its fiscal year, seeking to pave the way for future projects or launches.
The difficult integration after the purchase of Activision Blizzard
The acquisition of Activision Blizzard in 2023 brought with it a complex integration for Microsoft and its Xbox division.The multi-million dollar outlay not only made the Redmond company one of the biggest forces in the sector, but also increased pressure on short-term economic resultsSince then, management has increased its profitability requirements to justify the operation and seek greater efficiency, which has largely resulted in a progressive reduction in staff and the closure of subsidiaries considered less profitable.
Some Xbox officials have stated that These layoffs are difficult decisions that seek to maintain competitiveness.While they recognize the human impact, they believe these measures are necessary to ensure the viability of the brand's future products and services.
Impact and future of Xbox after layoffs
The video game industry is closely monitoring the consequences that may arise from this new wave of layoffs.The reduction in teams and closure of studios could affect the development of new franchises and the quality of Xbox titles in the medium and long term. Furthermore, the loss of presence in key European markets could impact its global competition.
Meanwhile, the company continues to develop the next generation of consoles, in collaboration with technology partners such as AMD, and is preparing to unveil new features at events such as Gamescom. However, Internal uncertainty and lack of official communication generate discouragement among employees.
Over the past year and a half, Microsoft has undergone a profound restructuring of its Xbox division, driven by the need to capitalize on the acquisition of Activision Blizzard and adapt to market challenges. The balance is a significant reduction in jobs, closure of important studios and a reconfigured presence in Central Europe.Xbox's future will depend on how it handles these changes, the reception of its next generation of consoles, and the market's response to a turbulent period for the brand.
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