Overview
- Microsoft announced job reductions reported as about 4,800 positions by the company with some outlets citing up to 6,400, a global cut that targets multiple business areas.
- Xbox will remove roughly 3,200 roles across fiscal 2027, with 1,600 layoffs effective immediately and the remaining 1,600 phased over the year.
- Xbox leadership told staff the division was “not healthy,” citing internal figures that it lost about $0.64 for every dollar invested and that its margins lag peers.
- As part of the reset, Microsoft will divest or spin off several studios, including Double Fine and Compulsion returning to independence and Ninja Theory and Undead Labs moving to new owners.
- The company says the moves free funding for large AI infrastructure projects including guidance near $190 billion in related spending and that eliminated roles are not being replaced by AI; further operational changes and phased actions may follow.