Microsoft is planning to lay off nearly 650 employees of its gaming division, as announced by Xbox CEO Phil Spencer in a letter to employees.
According to Game FileSpencer called it one of the most difficult days of his career. He explained that the decision to reduce staff was made as part of «aligning the post-acquisition team structure and business management» and to «organize the business for long-term success».
The layoffs will mainly affect corporate and support functions. According to a source familiar with the situation, the layoffs will mostly affect Activision Blizzard. At the same time, the heads of Xbox business units and related gaming teams will not be affected.
Spencer emphasized that the company will not close any game studio as part of these layoffs. There are also no plans to cancel the development of games, devices, or experiences. However, some teams will undergo changes due to «adapting to new priorities and managing the life cycle and performance of games».
For Microsoft Gaming, this is not the first reduction this year. In January, the company dismissed approximately 1900 employees from the Activision Blizzard, Zenimax, and Xbox teams. Later, the Arkane Austin and Tango Gameworks studios were closed, although the latter was later restored by Krafton.
In the letter, Spencer expressed his gratitude for the contribution of his colleagues and announced his support for the laid-off employees. They will be provided with «severance packages», which include severance pay, continued health insurance, and job placement services in the United States. He added:
«I know it’s hard to go through this change, but even in the most difficult times, this team has been able to come together and show care and kindness to each other, continuing to work for our players».
Source: Gamesradar