Microsoft lays off 1.900 employees in the Activision Blizzard and Xbox divisions
To a surprising extent, Microsoft announced today that it will eliminate 1.900 jobs in its Activision Blizzard and Xbox divisions. The layoffs come just a month after Microsoft completed its $68.700 billion acquisition of Activision Blizzard, the largest gaming deal in history.
According to a statement from Microsoft, the layoffs are part of a "strategic realignment" of its gaming business, which aims to "streamline operations, optimize resources and improve collaboration" between its studios and teams. The statement also states that affected employees will receive "comprehensive severance packages and transition support."
The layoffs will affect both Activision Blizzard and Xbox employees, with the former accounting for around 1.300 of the total cuts. Microsoft said it will retain the majority of Activision Blizzard's workforce, which numbered around 9.500 before the acquisition. However, some of the company's franchises, such as Call of Duty, Overwatch and Diablo, will see their staff and resources reduced.
The Xbox division will also face significant changes, as Microsoft plans to consolidate some of its studios and projects under the newly formed Xbox Game Studios. The division will lose about 600 employees, mostly from its publishing and marketing teams. Microsoft said it will focus on developing and supporting its core Xbox franchises, such as Halo, Forza and Gears of War.
The layoffs are a blow to the gaming industry, which has already been struggling with the effects of the COVID-19 pandemic, labor disputes and regulatory pressures. Many gamers and developers have expressed shock and disappointment at the news, especially given Microsoft's previous promises to respect Activision Blizzard's autonomy and creative culture.
Microsoft CEO Satya Nadella defended the decision in an internal memo to employees, saying it was necessary to "accelerate our vision for the future of gaming." He also thanked the laid-off workers for their contributions and assured them that they "will always be part of the Microsoft family."
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