Microsoft Layoffs: 1900 Job Cuts in Gaming Division Signal Industry Challenges Amidst Ongoing Restructuring Efforts

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By vibhuti 3 Min Read

In response to a tumultuous year in the gaming industry, Microsoft announces the layoff of 1,900 employees in its gaming division, citing a strategic need to minimize overlaps.

New Delhi, January 26, 2024 – In a significant shake-up within the gaming industry, Microsoft is set to lay off approximately 1,900 employees in its gaming division, as revealed in a company memo obtained by CNBC. The decision comes amidst a challenging year for the gaming sector, which witnessed an estimated 6,500 job losses across the field.

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The layoffs coincide with the departure of Blizzard president Mike Ybarra from the company. Microsoft Gaming CEO Phil Spencer, addressing the workforce reduction in the memo, stated that the goal is to minimize “areas of overlap.” While the contents of the memo have not been independently reviewed by NBC News, Spencer acknowledged the difficulty of the situation, referring to the layoffs as “painful.”

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In the comprehensive memo shared by CNBC, Spencer expressed gratitude to the affected individuals for their significant contributions to the success of Activision Blizzard, ZeniMax, and the Xbox teams. The move follows Microsoft’s acquisition of gaming giant Activision Blizzard just over three months ago, which includes popular titles such as Call of Duty, Crash Bandicoot, World of Warcraft, and Spyro.

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Despite the challenges, Spencer outlined Microsoft’s commitment to investing in areas that will foster business growth and support their strategy of expanding game accessibility globally. He conveyed confidence in the team’s ability to continue creating engaging games and immersive worlds.

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The gaming industry has witnessed a wave of layoffs throughout the year, with an estimated 5,800 job cuts reported this month alone across various publishers, developers, and related companies. Riot Games, the publisher of League of Legends and Valorant, recently laid off 530 employees, while Twitch, owned by Amazon, and popular gaming chat software developer Discord also announced significant workforce reductions.

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As the industry navigates these challenges, the focus remains on adapting to evolving market dynamics and ensuring the sustained growth and development of the gaming ecosystem.

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