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Microsoft to Lay Off 650 Jobs in Xbox Games Division, Bloomberg Reports

Microsoft (MSFT.O) plans to cut 650 jobs in its Xbox division, marking the third round of layoffs this year as it seeks to reduce costs and streamline operations following its $69 billion acquisition of Activision Blizzard, Bloomberg News reported on Thursday.

The gaming industry has faced widespread layoffs, studio closures, and project cancellations in the first half of the year, driven by a sluggish rebound in gamer spending after engagement levels peaked during the pandemic.

According to the report, which cited a memo from Xbox head Phil Spencer, the job cuts will primarily affect corporate roles and support functions. The memo also indicated that no games, devices, or experiences are being canceled, nor are any studios being shut down as part of these workforce reductions.

Microsoft and Xbox have not yet responded to Reuters’ requests for comment.

Microsoft completed its acquisition of Activision Blizzard last year, significantly enhancing its presence in the video gaming market with popular titles like “Call of Duty” to better compete with market leader Sony (6758.T).

Earlier this year, Microsoft announced it would lay off 1,900 employees at Activision Blizzard and Xbox. In May, Xbox also closed several gaming studios, including Arkane Austin.

Research firm Newzoo recently lowered its annual growth forecast for the global video game market, citing underperforming console sales and a limited number of new game releases this year.

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