In June, we reported that Microsoft was planning another major wave of layoffs. This has now been confirmed by Phil Spencer, the head of the gaming division. In an internal message, he said that employees would be informed about all the changes in the coming days. These layoffs are meant to increase the company’s agility and effectiveness.
Phil admitted that the layoffs are happening during one of the division’s most successful periods. However, he explained that today’s strong position was made possible by “tough decisions” taken in the past, referring to earlier rounds of layoffs. Because of this, Microsoft is making new choices to ensure future success.
He said,
I recognize that these changes come at a time when we have more players, games, and gaming hours than ever before. Our platform, hardware, and game roadmap have never looked stronger. The success we’re seeing currently is based on tough decisions we’ve made previously. We must make choices now for continued success in future years and a key part of that strategy is the discipline to prioritize the strongest opportunities.
Among the affected studios are several offices of ZeniMax Media. King, the developer of Candy Crush, will also be impacted, with about 10% of its staff—around 200 people—being let go. Overall, it is reported that Microsoft will lay off roughly 9,000 employees across the company.
After acquiring Activision Blizzard in late 2023, Microsoft had already laid off many people in its gaming division. For instance, in January 2024, the company let go of 1,900 employees. A few months later, it shut down several studios. By May 2025, Microsoft had laid off a total of 6,000 people, which was about 3% of its workforce.
