Xbox is set to cut up to 3,200 staffers, which represents about 20% of its total workforce, in what new CEO Asha Sharma describes as the "most significant restructure" in the company’s history. This announcement was made on July 6, 2026, following weeks of speculation regarding a necessary reset within the Microsoft division.
Details of the Restructuring Plan
The restructuring will involve the spin-off or sale of four studios: Ninja Theory, Undead Labs, Compulsion Games, and Double Fine Productions. Collectively, these studios employ approximately 350 people. The layoffs will occur in addition to the 1,600 staffers expected to be let go this week.
Sharma's memo indicated that the workforce reduction is part of a broader strategy to streamline operations and focus on core functionalities moving forward. The changes aim to position Xbox more competitively in the gaming industry.
Impact on Xbox Studios and Employees
This significant workforce reduction will impact various teams within Xbox, particularly those at the affected studios. Employees are understandably concerned about job security and the future direction of their projects. The announcement has prompted discussions about the company's commitment to its gaming portfolio and the potential for future growth.
In the memo, Sharma emphasized the importance of innovation and adaptability in a rapidly evolving market. She noted that the decision was not made lightly, acknowledging the contributions of all employees affected by the layoffs.
Future Outlook for Xbox
As Xbox navigates this turbulent period, the focus will be on enhancing efficiency and delivering high-quality gaming experiences. The gaming giant aims to refocus its efforts on key franchises and projects that resonate with players. The restructuring may pave the way for new opportunities as Xbox seeks to adapt to the changing landscape of the gaming industry.
- 3,200 total staff cuts
- 20% reduction of workforce
- 1,600 layoffs this week
- Four studios affected
- Aiming for innovation in gaming
🤖 This article was rewritten by Feed and Figures' editorial AI from a report originally published by Variety. Facts and quotes are preserved from the original; the rewrite focuses on clarity and structure. For the unedited original, see the source link below.
