In its third round of layoffs this year, Microsoft is preparing to cut 650 employees from its Xbox division, according to sources from Bloomberg News. Xbox head Phil Spencer sent a memo to employees stating that the layoffs will mostly impact the corporate and support teams.
The gaming industry saw significant growth during the pandemic, as people turned to digital games for entertainment and social interaction while spending more time at home. Microsoft, which released the Xbox Series X and Series S consoles in 2020, experienced substantial growth in both user base and revenue, with millions of users subscribing to its Game Pass service.
However, as life has returned to normal, Xbox has seen a notable decline in revenue. Earlier this year, Microsoft conducted mass layoffs in the Xbox division, shutting down several game studios and canceling some projects. In January, the tech giant laid off 1,900 employees from the Activision Blizzard and Xbox teams as part of its cost-reduction efforts.
Bloomberg reports that in the memo sent by Phil Spencer, the Xbox head reassured employees that no games, products, or experiences would be canceled, and no studios would be closed as part of this restructuring.
