Microsoft has begun a new round of mass layoffs, impacting its gaming division despite Xbox boss Phil Spencer saying that the company's "platform, hardware, and game roadmap have never looked stronger."
Whispers of upcoming job cuts were reported by Bloomberg last week, which now writes that employees are being informed today of the plans. Candy Crush developer King is cutting around 200 jobs, affecting roughly 10% of its staff, according to the site's sources. The exact number of layoffs across other offices, such as in the US and the rest of Europe, isn't currently clear.
In a statement provided to GamesRadar+ on July 2, a Microsoft spokesperson says: "We continue to implement organizational and workforce changes that are necessary to position the company and teams for success in a dynamic marketplace."
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While no specifics were provided confirming the number of Microsoft Gaming employees affected by the layoffs, it's stated that roughly 4% of Microsoft's total workforce has been impacted. As of last year, it was estimated that Microsoft employs roughly 228,000 people.
Bloomberg also shares an email that was sent to staff by Microsoft Gaming CEO Phil Spencer (posted in full by The Verge), who acknowledges that "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."
However, he adds that "the success we're seeing currently is based on tough decisions we've made previously," and insists that "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.
"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," Spencer continues. "This focused approach means we can deliver exceptional games and experiences for players for generations to come."
Spencer adds that "we would not be where we are today without the time, energy, and creativity of those whose roles are impacted," and says those affected are "encouraged to explore open positions across Microsoft Gaming, where their applications will be given priority review."
However, as Bloomberg points out, the situation feels particularly dire, given that this is the fourth round of layoffs since January 2024, when almost 2,000 people lost their jobs. After that, there was the closure of studios, including Arkane Austin and Tango Gameworks (the latter of which was later revived by Krafton), followed by the layoff of another 650 people a few months later.
The full situation still appears to be unfolding, with more details emerging gradually, as it's also been reported that Everwild, an action-adventure from Rare, has been canceled amidst the layoffs.
This article has been updated to include a statement from a Microsoft spokesperson.
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