Xbox cuts 20% of workforce, separates four studios in restructuring

Microsoft's Xbox division announced a major restructuring on July 6, including a 20% workforce reduction over the next year. Four studios are being separated: Double Fine and Compulsion Games are becoming independent with Microsoft funding and retaining their IP, while Undead Labs and Ninja Theory have been sold to undisclosed buyers. Arkane Studios' future is uncertain as Xbox reviews strategic options. The cuts follow Microsoft's $69 billion acquisition of Activision Blizzard and broader tech industry layoffs. No official statements from studio leadership have been released.

Global Impact

Economically, the layoffs add to the 2024 tech sector job cuts, affecting thousands of developers and related service industries. Industry-wide, the shift away from first-party exclusivity could reshape console competition, potentially reducing hardware differentiation.