Xbox is reportedly preparing to lay off hundreds more people this week as the company plans to consolidate several of its studios.
The news comes from an exclusive report on The Information, which cites a source briefed about Microsoft’s plans. The report does not say which of Xbox’s many studios are affected and which are being consolidated.
If correct, this would be the second wave of Xbox layoffs this year, following major restructuring in July that resulted in 1,600 job cuts. This is part of Xbox CEO Asha Sharma’s plan to “reset” Microsoft’s gaming division and return it to profitability. When those cuts were announced, Sharma also said the company intended to cut a further 1,600 jobs before a year had passed (taking us to next summer, approximately). These reported layoffs could be that second wave.
July’s layoffs saw cuts across almost the entirety of Xbox’s studio portfolio, though some teams were more affected than others. Xbox also shed a handful of studios, with some of those, such as Double Fine Productions and Compulsion Games, buying back their independence. Other studios, such as Ninja Theory and State of Decay maker Undead Labs, were instead sold to as-yet unnamed buyers, and Dishonored studio Arkane Lyon is undergoing consultation, and its fate remains unknown.
Sharma’s plan is for Xbox to focus on making games in its biggest franchises, such as The Elder Scrolls and Fallout. But the cuts impacted Fallout and Elder Scrolls maker Bethesda too, and Elder Scrolls Online developer Zenimax Online. Doom and Quake maker id Software was also heavily impacted.
As a result, morale was reportedly low at Xbox following July’s cuts and it’s not likely to get better this week, should the layoffs occur.
