Overview
- Microsoft confirmed on Monday that it will eliminate about 4,800 roles worldwide, roughly 2% of its workforce, with about 3,200 job losses concentrated in the Xbox division.
- Xbox will remove 1,600 positions immediately and phase out about 1,600 more over the next 12 months as part of what leadership calls a ‘reset’ of the gaming unit.
- The company will divest or return several studios rather than close them, with Compulsion Games and Double Fine set to return to their founders and other studios being sold or spun out with IP transfers and transitional funding.
- Microsoft says the cut roles will not be replaced by AI but acknowledges that AI is changing how work gets done, and it will shift resources toward very large AI and data‑center investments reported at roughly $190 billion.
- Leadership also plans to slim Xbox management from as many as 14 layers to three to five, promises no cancellation of announced first‑party titles, and expects further reductions across Commercial Business and LinkedIn that will affect hundreds of employees.