Xbox Continues “Reset” With Additional Layoffs And Restructuring

Microsoft‘s Xbox is continuing what it calls a “reset,” announcing more layoffs and restructuring as it adjusts to a changing operating environment.

Chief Content Officer Max Booty told employees in a memo Tuesday that the company would be eliminating 268 roles across Halo Studios, and in other areas including first-party studios. The company cut 3,200 workers in July, part of an industrywide recalibration as publishers reckon with the rise of casual and mobile gaming and challenges to the long-established console franchise business.

“The actions completed since July, inclusive of the studio divestitures, bring us roughly three-quarters of the way through previously announced restructuring,” Booty wrote in the memo. “I am deeply grateful for what our colleagues have built, and I know how difficult today will be for those leaving and the teams around them.”

Along with the layoffs, Xbox is also reorganizing its studios. The goal, according to Booty, “is to strengthen our franchises and games by operating fewer business units, aligning groups that already work closely together, and focusing our publishing expertise.”

Microsoft closed the $69 billion acquisition of Activision Blizzard in 2023, creating a massive new player in video games. While the sector continues to take in tens of billions in revenue, it has been disrupted by a number of trends among gamers and consumers. Large publishers like Ubisoft have also announced layoffs and newer entrants like Netflix have had to dramatically reconfigure their operations, shuttering studios and stepping back from big franchise bets in favor of pre-branded casual titles.

A town hall scheduled for October 6 will allow employees to “reflect on our progress,” Booty wrote, along with looking ahead to a number of notable upcoming releases.