Microsoft lays off 1,900 employees from its gaming team

Microsoft has announced that it’s laying off 1,900 people from its gaming team - nearly 10 per cent of the 22,000 total headcount.

In an internal memo published by The Verge, Microsoft head of gaming Phil Spencer explained the layoffs are part of a “sustainable cost structure that will support the whole of our growing business” and reflected that it was a “painful decision".

Alongside those 1,900 members of staff leaving, Blizzard president Mike Ybarra and chief design officer Allen Adham have also decided to step down.

Blizzard’s unreleased survival game, first teased in 2022, has been cancelled as a result of the departures.

The layoffs follow Microsoft’s acquisition of Activision Blizzard in October 2023, a move that faced significant legal opposition and slowdown. Now that the deal’s gone through though, Spencer says, Microsoft needed to identify overlaps and seek out efficiencies.

They’re not the only company to take such measures. Riot Games, Google, Discord, Twitch, Unity, eBay, Embracer Group and others have all announced staff cuts in recent months.

There isn’t really a silver lining or a pithy signoff to this one. Our thoughts are with all those affected. Thanks for the great games, everyone. We look forward to your next projects, whatever they may be.