U.S. technology giant Microsoft (MSFT) is cutting 4,800 jobs as it overhauls its troubled Xbox video game unit.
The job cuts represent 2% of Microsoft’s global workforce, according to the company.
Xbox is undergoing the biggest overhaul in its history, with 3,200 gaming jobs being eliminated over the next year and four studios that produce video games being shutdown.
The cuts amount to 20% of Xbox employees. Other layoffs are occurring in Microsoft's commercial business group.
These are the latest in a series of staff cuts at Microsoft as the company invests heavily in artificial intelligence (A.I.) infrastructure.
Last year Microsoft conducted several rounds of employee layoffs, including one round that cut 9,000 jobs.
In the latest restructuring, Xbox is set to lose four video game studios. The company’s Xbox unit has struggled since Microsoft acquired Activision Blizzard in 2023 for $75.4 billion U.S.
The purchase of gaming giant Activision Blizzard gave Microsoft popular titles and franchises such as “Call of Duty,” “World of Warcraft,” and “Candy Crush.”
However, the acquisition left the Xbox unit bloated and in need of streamlining, said Microsoft. Revenue in the Xbox division has also been shrinking in recent year amid rising competition.
MSFT stock has declined 22% over the past 12 months to trade at $386.74 U.S. per share.
Tech Insider
