Massive Job Cuts at Xbox, 3,200 Employees Impacted

Microsoft’s gaming division Xbox has announced one of the biggest restructuring efforts in its history, with plans to cut around 3,200 jobs, nearly 20% of its workforce. The company has already removed about 1,600 positions in the first phase, while the remaining layoffs will be completed by the end of fiscal year 2027. The restructuring comes amid Microsoft’s focus on cost reduction and increased investment in artificial intelligence.

Xbox CEO Asha Sharma said the company’s current business performance requires major changes, noting that Xbox’s profit margins are lower compared to leading gaming platforms and publishers. As part of the restructuring, four gaming studios will be transferred to new ownership, while another studio’s future is under review. The company will also reduce management layers and cut vendor expenses. Helen Chiang has been appointed as the new Chief Operating Officer to oversee content, hardware, platforms, and services. Xbox assured that major ongoing game projects will continue and investments in the gaming business will remain focused.