In yet another crushing blow to the company’s operations, Microsoft has decided to lay off 650 employees from its gaming division.
This news was first broken to the public by GameFile, who learned of the development from an insider source, and to Microsoft employees via an email from Microsoft Gaming head Phil Spencer.
According to GameFile’s insider source, these cuts will “mainly impact corporate and support roles at Activision Blizzard,” as reported by a source familiar with the matter”, as well as the Warcraft Rumble and Call of Duty Warzone Mobile mobile game teams.
“For the past year, our goal has been to minimize disruption while welcoming new teams and enabling them to do their best work,” said Spencer. “As part of aligning our post-acquisition team structure and managing our business, we have made the decision to eliminate approximately 650 roles across Microsoft Gaming—mostly corporate and supporting functions—to organize our business for long term success.”
“I know that this is difficult news to hear,” he then acknowledged. “We are deeply grateful for the contributions of our colleagues who are learning they are impacted. In the US, we’re supporting them with exit packages that include severance, extended healthcare, and outplacement services to help with their transition; outside the US packages will differ according to location.”
Despite this shake-up, Spencer assured that “No games, devices or experiences are being cancelled and no studios are being closed as part of these adjustments today.”
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Per the wording in Spencer’s email, it appears that these rounds of layoffs are an attempt to right the Microsoft ship following their purchase of Activision Blizzard.
A move clearly driven by a desire to reduce competition rather than foster any actual growth in the video game industry, rather than opening up a golden new era for the Xbox brand, the company’s acquisition of the Diablo and Overwatch developer has instead seen Microsoft continually scrambling to balance their flailing operations with their Activision Blizzard-related debt.
But as this latest move clearly shows, their current strategies have not been working – and whether there’s any chance of ironing out these related problems remains to be seen.
Notably, this move comes less than a year after the company’s previous round of mass layoffs, wherein they further downsized the Actvision Blizzard and Xbox teams by roughly 1,900 team members.