Microsoft is cutting 3,200 Xbox employees, and half of them will be eliminated today in "the most significant restructure in Xbox history"

Xbox layoffs have begun. CEO Asha Sharma announced that 1,600 roles will be eliminated today, July 6, as part of a staff reduction plan that will see approximately 3,200 people cut throughout the 2027 fiscal year. Sharma describes the plan as "the most significant restructure in Xbox history." "I recognize that a year-long restructuring creates additional challenges," Sharma adds. "Unfortunately, it is not possible to make all the necessary changes in a single day, and I wanted to be direct about the scale." These 1,600 people will exit the company alongside four studios: Compulsion Games and Double Fine will operate independently, while Ninja Theory and Undead Labs have "entered terms to join new ownership." Additionally, Xbox is reviewing "potential strategic options" with Dishonored maker Arkane, which was rumored to be on the chopping block amid Marvel's Blade production obstacles. This story is developing. [/url]

Jul 6, 2026 - 22:04

Microsoft is cutting 3,200 Xbox employees, and half of them will be eliminated today in "the most significant restructure in Xbox history"

Xbox layoffs have begun. CEO Asha Sharma announced that 1,600 roles will be eliminated today, July 6, as part of a staff reduction plan that will see approximately 3,200 people cut throughout the 2027 fiscal year.

Sharma describes the plan as "the most significant restructure in Xbox history."

"I recognize that a year-long restructuring creates additional challenges," Sharma adds. "Unfortunately, it is not possible to make all the necessary changes in a single day, and I wanted to be direct about the scale."

These 1,600 people will exit the company alongside four studios: Compulsion Games and Double Fine will operate independently, while Ninja Theory and Undead Labs have "entered terms to join new ownership."

Additionally, Xbox is reviewing "potential strategic options" with Dishonored maker Arkane, which was rumored to be on the chopping block amid Marvel's Blade production obstacles.

This story is developing.

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