Overview
- Fortune reporting shows new layoff rounds will begin this month with further cuts planned for November and January, bringing total planned reductions to about 3,200 and 1,868 roles already eliminated.
- CEO Asha Sharma has cut several management layers and driven a broad reorganisation that has moved, spun out, or reassigned studios such as Obsidian to Bethesda and returned Double Fine and Compulsion to independent status.
- Microsoft leaders have publicly rejected claims that the company plans to sell Xbox and framed the moves as a leadership‑led effort to stabilise a business with weak recent gaming revenue and Game Pass performance.
- Staff reports and internal accounts describe deep morale damage and the loss of long‑tenured employees, raising concerns that disrupted teams and lost institutional knowledge will slow future game development and releases.
- Limited reporting also flags continuing product work under constrained resources, including a reported 2027 handheld, a 2028 home console codenamed Project Helix with internal price estimates of $1,200–$1,800, and potential changes to Game Pass strategy.