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Still in the afterglow of its Xbox Games Showcase just a few days ago, Bloomberg has reported that significant layoffs are expected to hit Microsoft’s Xbox division next month.
This round of layoffs, which is expected to begin following Microsoft’s financial year at the end of June, comes a full year after major redundancies saw Microsoft cut thousands of jobs, shut down its quadruple-A upstart, The Initiative, as well as torpedoing its Perfect Dark reboot, and ceasing production on Everwild, a long-gestating project Rare had been working on.
The extent of the upcoming layoffs is unknown, but in an email obtained by Bloomberg and later released in full as an Xbox Wire post, Asha Sharma and Matt Booty outlined plans to “reset the business” of Xbox, which has lost billions in revenue despite investing several billions more.
“We have spent over $20 billion (excluding Activision Blizzard King) on ongoing investments in our content, platform, and hardware subsidy, but our annual revenue has declined nearly half a billion during that time,” the statement reads.
“Going forward, this cannot continue.”
The letter also seems to suggest significant changes are afoot in terms of how Xbox approaches funding its production pipeline and its platform infrastructure, which the letter claims is not “built for the road ahead.”
It’s unclear whether this might mean further studio closures or game cancellations, but it appears we’ll learn much more in the coming month as it all unfolds.
