Microsoft has just announced a new wave of layoffs in its gaming teams. The job cuts are said to be linked to Microsoft’s acquisition of Activision Blizzard, with Phil Spencer stating that “no games, devices or experiences are being cancelled” as part of the process. Going even further, it is stated that no developers will be affected by this wave of redundancies. If these statements are true, it would ‘simply’ mean that Microsoft is streamlining its acquisition by eliminating duplicate positions.
After the euphoria, Microsoft is streamlining
Last year, Microsoft made one of the biggest acquisitions in the history of the sector, signing a cheque for almost $69 billion to buy Activision Blizzard. Following this deal, the Xbox Gaming entity now oversees a large number of development studios and no doubt plans to pool support and administrative functions.
Phil Spencer spoke directly to employees to explain the deal:
Over the past year, our aim has been to minimise disruption while welcoming new teams and allowing them to do their best. As part of aligning our post-acquisition team structure and managing our business, we have taken the decision to eliminate approximately 650 positions within Microsoft Gaming – primarily corporate and support functions – in order to organize our business for long-term success.
I know this is difficult news to hear. We are deeply grateful to our colleagues who learn that they are affected by this situation. In the US, we are supporting them with severance packages, extensive healthcare and outplacement services to help them through their transition. Outside the US, benefits vary according to location.
As a result of these changes, our corporate and support teams and resources are aligned with sustainable future growth and can better support our studio teams and business units with programmes and resources that can adapt to their needs. At the same time, as part of running the business, other teams are impacted as they adapt to changing priorities and manage the lifecycle and performance of games. No games, devices or experiences are being cancelled and no studios are being closed as part of these adjustments today.
Throughout our team’s history, we’ve seen some great moments and some more difficult ones. Today is one of those difficult days. I know going through more changes like this is difficult, but even in the most difficult times, this team has pulled together and shown care and kindness to each other while working to continue to deliver for our players. We appreciate your support as we go through these changes and thank you for your compassion and respect for each other.
Phil