Microsoft Prepares Major Xbox Layoffs Next Week: Report
▼ Summary
– Microsoft is reportedly planning significant layoffs at Xbox next week as part of a company-wide reorganization, according to Bloomberg.
– The layoffs follow previous cuts in May 2025 (3% of headcount) and January 2025, as well as gaming division layoffs in January 2024 (1,900 roles) and September 2024 (650 staff).
– In May 2024, Microsoft closed four Bethesda studios, though Tango Gameworks was later acquired by Krafton and saved from closure.
– Microsoft’s gaming segment reported a 5% year-on-year revenue increase in its Q3 2025 results.
– Microsoft has not commented on the reported layoffs, and GamesIndustry.biz has reached out for clarification.
Microsoft is reportedly gearing up for significant workforce reductions within its Xbox division as early as next week, according to insider sources. The anticipated cuts are expected to form part of a broader restructuring effort across the tech giant’s operations, though official confirmation from the company remains pending.
This development follows a pattern of recent workforce adjustments at Microsoft. Earlier this year, the company trimmed approximately 3% of its global workforce in May 2025, preceded by smaller-scale layoffs in January of the same year. The gaming division itself has faced repeated downsizing, with 1,900 positions eliminated in January 2024 and an additional 650 employees let go by September 2024.
Further turbulence hit Microsoft’s gaming subsidiaries when four Bethesda studios were marked for closure in May 2024, though Tango Gameworks—one of the affected teams—was later acquired by Krafton and retained. Despite these operational shifts, Microsoft’s gaming revenue showed resilience, climbing 5% year-over-year in its Q3 2025 financial report.
As speculation mounts, industry analysts are closely monitoring how these potential layoffs could impact Xbox’s long-term strategy. Requests for comment from Microsoft have so far gone unanswered, but updates will follow if the company provides further details. The gaming sector continues to navigate a challenging landscape, with major players balancing growth against cost-cutting measures.
(Source: Games Industry)
