Microsoft Initiates Minor Workforce Reductions Across Various Departments

Business Insider reports that Microsoft is eliminating roles throughout the organization. Two sources communicating with the publication suggested that these reductions were “minor,” and might potentially affect its security, gaming, and sales departments.

It is uncertain what “minor” entails in this context, considering Microsoft’s extensive size and the numerous divisions and companies it encompasses. When it dismissed 1,900 employees in January 2024, the company indicated that it had 22,000 personnel in its gaming division.

Last week, Microsoft acknowledged impending job cuts to Business Insider aimed at “underperforming” employees. Today’s reductions are reportedly unrelated to those layoffs.

For Microsoft, this signifies its third successive year of firing video game employees. Around this time in 2023, it terminated 10,000 staff from its entire workforce. First-party Xbox teams such as 343 Industries (now Halo Studios), The Coalition, and Bethesda Game Studios were affected. 343 was reported at the time to have been hit the hardest, leading several former developers to claim that Microsoft had mismanaged the studio during the development of Halo Infinite’s progress.

Last year, Microsoft laid off a notable number of workers following the acquisition of Activision Blizzard. At that time, Xbox chief Phil Spencer stated that the employee reductions would ensure that he and Activision leadership were “all unified on the best growth opportunities.”

Reductions continued into 2024, with Microsoft shutting down Arkane Austin and Tango Gameworks and laying off corporate staff and support personnel. Last May, Microsoft confessed it had spread itself too thin after the Activision acquisition and began offering some employees severance packages.

It was the closures of Arkane and Tango that generated the most backlash from the industry. At the time, the Communications Workers of America claimed these shutdowns could further inspire game developers to unionize. The union had previously praised Microsoft for not hindering the formation of unions across its various subsidiaries. Later, it criticized the tech giant for lacking “respect and compassion” by eliminating so many jobs.

Business Insider’s latest article did not provide a reason for why Microsoft is terminating positions in its gaming department. Its sources primarily focused on the reductions among the company’s security staff, but had no insights regarding the other two divisions.

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