Microsoft is eliminating around 4,800 roles, about 2.1 percent of its global workforce, the company said Monday. In a note to staff posted on the Microsoft blog, EVP and Chief People Officer Amy Coleman framed the move as part of the company's ongoing "transformation," saying she wanted to share the "why" behind the decisions.
The cuts land as Microsoft opens a new fiscal year, and come roughly a year after it shed about 9,100 employees. According to The Verge, most of the losses fall in Microsoft's Xbox and commercial sales organizations, with more than 30 percent of the job cuts hitting the gaming division alone. Reporter Tom Warren wrote that roughly 20 percent of Xbox jobs are set to disappear by the end of fiscal 2027.
The gaming side is being reshaped, not just trimmed. According to a Bloomberg report of an internal memo, Xbox CEO Asha Sharma told staff the unit will divest five studios and cut about 3,200 jobs in what she called a "reset" to streamline the business. Bloomberg reported that Compulsion and Double Fine will become independent, while Undead Labs and Ninja Theory will be sold. The Verge described the shake-up as Microsoft selling off four Xbox studios as part of significant gaming cuts.
CNBC reported that the reductions span Microsoft's commercial business and its Xbox gaming group, where revenue has been shrinking.
Why it matters: even a company riding the AI boom is willing to gut a marquee consumer business like Xbox to protect profits, a sign of how sharply Big Tech is redirecting money and people toward its highest-growth bets.