Xbox cuts 3,200 jobs as gaming business struggles

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Set us as preferred Xbox is hitting the reset button.Microsoft’s video game division plans to eliminate 3,200 jobs, or around 20% of its staff over the next year, as part of a sweeping reorganization to revive the company’s lagging games division.The cuts are driven by an increasingly challenging gaming landscape, said Xbox’s CEO Asha Sharma in a note to staff on Monday.“Our business today is not healthy,” Sharma wrote, adding that Xbox is operating at margins three to 10 times lower than comparable businesses.

“We must reset Xbox.” Hollywood Inc.Microsoft’s purchase of ‘Call of Duty’ maker Activision Blizzard marks the biggest deal in video game industry history.Although it has made some major investments, including the $69 billion acqusition of Activision Blizzard in 2023, Xbox hasn’t produced enough hit games as it has faced mounting competition.The Redmond, Washington-based company has laid off thousands of staff and canceled many projects since the acquisition of Santa Monica-based Activision, best known for its popular “Call of Duty” franchise.Some of the company’s biggest rivals are Sony’s PlayStation, Nintendo Switch and Steam, the digital storefront for PC games.These layoffs are a part of a bigger effort to downsize Microsoft.

In all, the tech giant is eliminating about 2% of its workforce.Business Meta Platforms Inc.

is alerting thousands of employees that they’re being laid off, part of a previously announced restructuring aimed at reducing costs while the company invests heavily in artificial intelligence.At Xbox, 1,600 jobs will be cut on Monday, the rest over the next 12 months, the company said.In addition to slashing its workforce, the company is shedding four of its studios.

Montreal-based Compulsion Games and San Francisco-based Double Fine Productions will be spun out and ...