This past week, Xbox gave a glimpse at the future of the console and the brand with several anticipated games and a new emphasis on console exclusives, and that seemed to excite the core Xbox fanbase. Unfortunately, the latest news from Microsoft Corp’s Xbox division isn’t great, as a new report states that major layoffs are being planned for the Xbox division.
Videos by ComicBook.com
The report comes courtesy of Bloomberg, which reported that the Xbox division is planning major job cuts for next month. This is part of new Chief Executive Officer Asha Sharma’s overhaul of the video game division, which is aiming to counteract declining revenue. The number of layoffs isn’t known at this time, but they are expected shortly after the close of Microsoft’s fiscal year, which happens on June 30th.
Everything We Know About Xbox’s Upcoming Layoffs And Shift in Strategy
In addition to the layoffs, sources said that Xbox is planning to significantly slash budgets for its marketing department and other areas of the business. This is all in response to declining revenue over the past several years, and Sharma spoke a bit about those issues in a blog post titled Next 100 Days: XBOX Reset.
In that blog post, Sharma highlighted the struggles at the moment, writing, “#2: We will end this fiscal year at about a 3% accountability margin, down year-over-year. Excluding Activision Blizzard King, over the past five years, we have spent over $20 billion on ongoing investments in our content, platform, and hardware subsidy, but our annual revenue has declined nearly half a billion during that time. Going forward, this cannot continue.”
This is also why there’s been an overall shift in approach to Xbox as a brand and a console, and at the Xbox Showcase it was revealed that both Gears of War: E-Day and Clockwork Revolution will be Xbox exclusives. It’s been assumed that E-Day was headed to PlayStation as well, especially after the recent Reloaded offering hit PS5, though the Halo remake is still heading to PlayStation later this year.
It’s always awful when layoffs hit, and if they are set to happen, we hope everyone lands on their feet.
What do you think? Leave a comment belowย and join the conversation now in theย ComicBook Forum!
Forum Conversation: What Do You Hope To See From The Xbox Revamp?
Go to ForumPretty brutal changes on the horizon (and rolling out as we speak) but I do like that they’re getting back to exclusives and trying to service their fanbase. Diverging from that in the first place was just bizarre.
I’m just praying Double Fine stays alive. They’re one of my favorite studios but I realize they probably don’t bring in much money while being expensive to operate. If Xbox is considering any studio closures, I fear they would be near the top of the list. Hopefully it won’t come to that.
Microsoft needs to:
Get consoles priced back down to inflation-adjusted pre-pandemic levels. What cost $399 during Xmas of 2024 is now selling for over $600. Casual gamers are voting with their feet.
Leverage day one exclusives and stop playing nice with the PS crowd. Discount the Xbox versions, make hardware package deals and make “early access” for AAA titles an XBox perk.
Buy a controlling interest in Kojima to dilute 3rd party PS exclusives
Position the console to be able to play PC games from Steam, etc. by leveraging the dev pipelines that already exist and that THEY ALREADY CONTROL. This is a heavy lift but appears to already be in progress. This will help recession-proof the platform when the next inevitable slowdown happens and will position them way above Sony in terms of depth of titles and experience.
Slap a cork in the creative brain drain that’s been happening. Middle management is expendable – the minds that create a franchise aren’t (maybe that’s where she’s going?)