Overview

• In early July Microsoft cut 9,000 jobs company-wide, including many roles in Xbox Game Studios, and shut down studios like The Initiative.
• Microsoft has committed $80 billion to AI infrastructure this year and tied employee performance evaluations to mandatory use of internal AI tools like Copilot.
• Xbox executive producer Matt Turnbull advised laid-off staff on LinkedIn to use AI chatbots such as ChatGPT for emotional support and job hunting, drawing criticism for insensitivity.
• Mike Matsel, Xbox Graphics lead, posted an AI-generated hiring image riddled with technical oddities—such as code displayed on the back of a monitor—which provoked public backlash for being tone-deaf.
• Industry observers warn that Microsoft's accelerated AI-driven restructuring risks displacing skilled workers without adequate retraining or support programs.