Microsoft is cutting 1,900 staff across Xbox, Bethesda and Activision Blizzard

Microsoft’s head of gaming has confirmed that 1,900 staff will be laid off across Activision Blizzard, Bethesda and Xbox.

In a message sent to staff obtained by IGN, Spencer said Microsoft would provide “full support to those who are impacted during the transition, including severance benefits informed by local employment laws.”

According to the exec, the decision had been made after Microsoft and Activision Blizzard’s leadership teams “set priorities, identified areas of overlap, and ensured that we’re all aligned on the best opportunities for growth”.

Alongside the layoff news, Blizzard president Mike Ybarra has confirmed he’s decided to leave the company. Allen Adham, Blizzard’s chief design officer, is also leaving the company, reports The Verge.

Blizzard’s previously announced survival game, which was being helmed by Ubisoft’s former Far Cry boss Dan Hay, has also been cancelled as part of these changes.

The layoffs come just three months after Microsoft’s completion of its $69 billion acquisition of Call of Duty owner Activision Blizzard.

Spencer said in the email to staff: “As we move forward in 2024, the leadership of Microsoft Gaming and Activision Blizzard is committed to aligning on a strategy and an execution plan with a sustainable cost structure that will support the whole of our growing business. Together, we’ve set priorities, identified areas of overlap, and ensured that we’re all aligned on the best opportunities for growth.

“As part of this process, we have made the painful decision to reduce the size of our gaming workforce by approximately 1900 roles out of the 22,000 people on our team. The Gaming Leadership Team and I are committed to navigating this process as thoughtfully as possible.

“The people who are directly impacted by these reductions have all played an important part in the success of Activision Blizzard, ZeniMax and the Xbox teams, and they should be proud of everything they’ve accomplished here. We are grateful for all of the creativity, passion and dedication they have brought to our games, our players and our colleagues.

“We will provide our full support to those who are impacted during the transition, including severance benefits informed by local employment laws. Those whose roles will be impacted will be notified, and we ask that you please treat your departing colleagues with the respect and compassion that is consistent with our values.

“Looking ahead, we’ll continue to invest in areas that will grow our business and support our strategy of bringing more games to more players around the world. Although this is a difficult moment for our team, I’m as confident as ever in your ability to create and nurture the games, stories and worlds that bring players together.”

The news follows just a year on from Microsoft’s last round of layoffs, which partially affected its gaming teams. In January 2023 it confirmed plans to lay off approximately 10,000 employees, or around 4.5% of the US technology giant’s 220,000-person workforce.

Job losses across the games industry were widespread in 2023, with 9,000 layoffs estimated, and they don’t appear to be slowing this year.

According to a GDC survey, around a third of developers say they were impacted by layoffs at their workplace over a 12-month period.

Of 3,000 developers surveyed, 35% said they were impacted by layoffs during this period – 7% were personally laid off, a further 17% said colleagues in their department were laid off, and 11% said other teams or departments had layoffs.