Microsoft Cuts 1,900 Workers in Gaming Business
Microsoft is reducing its gaming workforce by 1,900 employees to address overlaps after acquiring Activision Blizzard. The gaming industry is experiencing a wave of layoffs in the tech sector.
Microsoft Corp. is reportedly laying off 1,900 workers in its gaming business, following in the footsteps of other tech companies in the same industry. Phil Spencer, CEO of Microsoft Gaming, explained in a memo to employees that these cuts are aimed at reducing overlaps after the company's acquisition of Activision Blizzard last year. He acknowledged that those affected by the layoffs have played a crucial role in the success of Activision Blizzard, ZeniMax, and Xbox teams. It's worth noting that Microsoft also acquired ZeniMax Media, the parent company of game publisher Bethesda Softworks, in 2021.
The gaming industry as a whole has been affected by recent layoffs in the tech sector. Amazon.com Inc. announced plans to cut 500 jobs in its popular Twitch live-streaming business, while Unity Software Inc. revealed it would be reducing its workforce by around 1,800 employees or 25%. Riot Games, owned by Chinese tech giant Tencent Holdings Ltc., also disclosed it would be cutting approximately 530 jobs globally, accounting for about 11% of its total workforce.
In a blog post, game developer and games-industry consultant Rami Ismail highlighted that in the first few weeks of 2024, the videogame industry has already experienced more than half the number of layoffs witnessed throughout 2023.
"I just ran the numbers," Ismail wrote on X, formerly known as Twitter. "With todays’ Activision-Blizzard/Microsoft layoffs added, in just 25 days of 2024 we're already at over HALFWAY to the total layoffs of ALL OF 2023 (5,600 versus 10,500)."
Tech-sector layoffs were a significant theme in 2023 and continue to dominate the headlines. Xerox Holdings Corp. XRX, +13.68% announced plans earlier this month to reduce its workforce by 15%, while eBay Inc. EBAY, +0.23% revealed it is cutting about 1,000 jobs, accounting for 9% of its full-time employees. Additionally, Amazon is set to eliminate "several hundred" positions within its Prime Video and MGM Studios organization.
Bloomberg reported this week that Google parent Alphabet Inc. GOOGL, +2.83% GOOG, +2.87% is also letting go of numerous workers at its X technology lab. However, Alphabet is yet to respond to any requests for comment.
According to data compiled by the website Layoffs.fyi, there have already been 82 tech companies that have laid off a total of 23,670 employees globally this year. If this pace continues throughout 2024, it will surpass the total number of layoffs in 2023, when 1,183 tech companies cut 261,997 jobs worldwide. These figures show a significant increase from 2022, during which 1,064 tech companies laid off 164,969 employees.
Jon Swartz and Bill Peters contributed.