Microsoft Reportedly Planning 'Substantial' Layoffs at Xbox Division Next Week

Microsoft is reportedly planning another round of job cuts at its Xbox division as part of larger re-organisation efforts at the company. The Xbox parent is said to be gearing up to lay off a significant number of employees across its entire gaming division. The move would follow several rounds of layoffs at Xbox last year following its acquisition of Call of Duty maker Activision.

Xbox Said to Face Layoffs

According to a Bloomberg report published Tuesday, Xbox managers are expecting “substantial” layoffs at the division next week. This would be the first round of layoffs at Xbox this year, but the fourth since the biggening of 2024.

Microsoft laid off over 1,900 Xbox employees, including at the newly acquired Activision Blizzard unit, in January last year — about eight percent of overall gaming division staff. The company also cancelled an unannounced survival game in development at Blizzard at the time.

In May, the company shut down three of its Bethesda-owned game studios, including Hi-Fi Rush developer Tango Gameworks and Redfall maker Arkane Austin, to shift focus on to its “priority games”. The studio closures led to “significant layoffs”.

The in September, the tech giant slashed 650 jobs at the Xbox division to rein in costs following the $69 billion acquisition of Activision.

This year, Microsoft laid off around three percent of its workforce, around 6,000 employees as the company's spending on AI ballooned. The layoffs this year did not affect the Xbox division.

The upcoming round of retrenchment will reportedly affect the entire Xbox group. Earlier this month, Xbox held its games showcase event, where it revealed the next Call of Duty and announced the first Xbox-branded gaming handheld PC made in collaboration with Asus.