Microsoft is laying off around 1,900 staff (nearly 9% of the 22,000 total) across its gaming division inclusive of the Xbox, Activision Blizzard and the Zenimax (Bethesda) teams. The news comes from a letter sent to staff by Xbox head Phil Spencer, which was obtained and shared by IGN, in which Spencer essentially says that overlap in roles and shifting priorities among the businesses it’s acquired is the primary reason for these cuts.
Staff affected will be given “full support” and severance benefits according to local employment law.
The full letter reads:
“It’s been a little over three months since the Activision, Blizzard, and King teams joined Microsoft. As we move forward in 2024, the leadership of Microsoft Gaming and Activision Blizzard is committed to aligning on a strategy and an execution plan with a sustainable cost structure that will support the whole of our growing business. Together, we’ve set priorities, identified areas of overlap, and ensured that we’re all aligned on the best opportunities for growth.
“As part of this process, we have made the painful decision to reduce the size of our gaming workforce by approximately 1,900 roles out of the 22,000 people on our team. The Gaming Leadership Team and I are committed to navigating this process as thoughtfully as possible. The people who are directly impacted by these reductions have all played an important part in the success of Activision Blizzard, ZeniMax and the Xbox teams, and they should be proud of everything they’ve accomplished here. We are grateful for all of the creativity, passion and dedication they have brought to our games, our players and our colleagues. We will provide our full support to those who are impacted during the transition, including severance benefits informed by local employment laws. Those whose roles will be impacted will be notified, and we ask that you please treat your departing colleagues with the respect and compassion that is consistent with our values.
“Looking ahead, we’ll continue to invest in areas that will grow our business and support our strategy of bringing more games to more players around the world. Although this is a difficult moment for our team, I’m as confident as ever in your ability to create and nurture the games, stories and worlds that bring players together.
“Phil.”
In the hours since the announcement, many staff have already taken to social media to express their disappointment and frustration, especially where nearly entire teams have been let go.
I lost basically my entire team. I am at a loss for words right now
— mike (@rzn_mike) January 25, 2024
Just got laid off with basically my entire team. Can't really process it atm. After the rocky launch of OW 2 we finally built up a great team that was working on some awesome stuff. Then suddenly we all get laid off. Cant even go get stuff off my desk today.
— Jorge Murillo ? (@TheHornetsFury) January 25, 2024
Windows Central’s Jez Corden also reports that Activision Blizzard’s dedicated support team has been axed and will be outsourced, along with Microsoft’s departments responsible for physical Xbox games at retail.
Multiple sources tell me that Microsoft is laying off the entire internal customer support team(s) for ABK games, save a few.
MS will outsource the rest to external companies abroad.
ABK was one of the few games pubs with a high-quality internal customer support team.
— Jez (@JezCorden) January 25, 2024
Along with these changes, Blizzard Entertainment’s President Mike Ybarra has announced his is leaving the company, and Head of Microsoft Studios Matt Booty has informed staff via an internal memo that development on Blizzard’s previously-revealed survival game is being cancelled, saying, “As part of this focus, Blizzard is ending development on its survival game project and will be shifting some of the people working on it to one of several promising new projects Blizzard has in the early stages of development.”
I want to thank everyone who is impacted today for their meaningful contributions to their teams, to Blizzard, and to players’ lives. It’s an incredibly hard day and my energy and support will be focused on all those amazing individuals impacted – this is in no way a reflection…
— Mike Ybarra ? (@Qwik) January 25, 2024
This year has already been significant in terms of gaming industry layoffs, with some particularly big and seemingly infallible companies, like Riot, being affected in big ways.
