Microsoft lays off another 650 people in its gaming unit

The company on Thursday announced plans to lay off 650 employees, which will bring the total number of job losses since its October 2023 acquisition of Activision-Blizzard to 2,550.

The latest round of cuts will largely impact corporate and support roles. No studios are being closed and no games or game systems will be cancelled as a result of the belt-tightening. (Microsoft closed Tango Gameworks (makers of Hi-Fi Rush) and Redfall developer Arkane Austin in previous layoff rounds, which did impact its upcoming titles.)

“Throughout our team’s history, we have had great moments, and we have had challenging ones,” wrote Phil Spencer, chief executive of Microsoft Gaming in an email announcing the cuts. “Today is one of the challenging days. I know that going through more changes like this is hard, but even in the most trying times, this team has been able to come together and show one another care and kindness as we work to continue delivering for our players. We appreciate your support as we navigate these changes and we thank you for your compassion and respect for each other.”

Microsoft’s layoffs have been among the most high profile, given the number of people impacted and the company’s prominent standing, but it’s hardly the only game maker who is struggling today. The industry, as a whole, is in a slump following a tremendous surge in consumer interest during the pandemic.

More than 11,500 people in the video game industry have lost their jobs in 2024. That’s more than the entirety of 2023 (10,500) and 2022 (8,500).

Sales of Microsoft’s Xbox were down substantially in the latest financial quarter, though Microsoft has been less focused on game hardware and moreso on its GamePass game streaming service in the past year. It raised prices for that in July and in February disclosed that service had 34 million subscribers.