Microsoft layoffs now surge in the company’s Xbox division affecting nearly 300 Microsoft employees.
The filing was made public Thursday afternoon under the Worker Adjustment and Retraining Notification (WARN) Act (bookmark our WARN layoffs reports here).
The latest Microsoft layoffs will impact just under 600 employees globally, the company said.
Out of those 600, a total of 277 were laid off from Microsoft’s Redmond campus, which included 25 remote employees in the region.
268 of those layoffs were in Xbox Game Studios, part of a restructuring with the goal of returning the games division to growth and profitability.
The company said that work on the next Halo game is moving to its Activision subsidiary.
“First, we are eliminating 268 roles across Halo Studios, other first-party studios, and the XGS management and central functions layer.
The actions completed since July, inclusive of the studio divestitures, bring us roughly three-quarters of the way through previously announced restructuring.
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,” said Chief Content Officer Matt Booty.
“Second, we are reorganizing our studios. The goal is to strengthen our franchises and games by operating fewer business units, aligning groups that already work closely together, and focusing our publishing expertise,” he continued.
Microsoft Layoffs Will Grow Past 3,000 Cuts
Xbox employees have been laid off as Microsoft restructures to cut costs and maintain profitability.
Layoffs at Microsoft are expected to surpass 3,000 employee job cuts.
The company said in July that it would cut roughly 3,200 roles by the end of the year.
Xbox CEO Asha Sharma called it the biggest restructuring in Xbox history.
Why is Microsoft Laying Off Thousands?
The company’s decision to prune thousands of employees from its Xbox division reflect a direct focus on cutting costs to grow and remain profitable.
“The goal is to strengthen our franchises and games by operating fewer business units, aligning groups that already work closely together, and focusing our publishing expertise,” Booty wrote in a memo to employees Tuesday morning.
Microsoft’s latest layoffs now complete approximately 75% of the Xbox restructuring.
The cuts from the tech giant have come down from last year, though.
Microsoft eliminated 4,800 jobs globally in July, or about 2% of its workforce, including 605 in Washington state.
In 2025 however, it laid off over 15,000 across two layoff rounds.
Roughly 6,000 layoffs took place in May and approximately 9,000 in July, including 830 in Washington.
It’s Not All Bad News
Highly anticipated games for Xbox.
Microsoft’s highly anticipated games are not being affected.
Rob Kostich, president of Activision, said in a statement that the company has “already begun assembling a purpose-built team, unique in capability and talent.”
He said the goal is to “make the greatest Halo game ever, worthy of its universe and legacy, while staying true to what made players love it in the first place.”
Activision is also taking over World’s Edge, the Redmond studio behind Age of Empires, and assuming control of Rare, the English studio behind Sea of Thieves.
And Obsidian Entertainment will become part of Bethesda. The California studio made Fallout: New Vegas for Bethesda in 2010 as an outside developer, and it’s working on another game set in the Fallout universe now.
They also made what could be one of the most highly anticipated remake games of the decade, the original KOTOR, Star Wars Knights of The Old Republic.
While the latest Microsoft layoffs news is impacting thousands of employees, gamers will continue to see new titles during this restructuring period.
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