Microsoft has announced plans to cut 4,800 jobs — approximately 2.1% of its worldwide workforce — with a substantial number of those positions coming from its Xbox video game division, the company revealed Monday.
Among those losing their jobs are 1,600 Xbox employees, and the company has signaled that additional cuts are on the way as part of a wider reorganization aimed at giving the gaming brand a fresh start. The Redmond, Washington-based tech giant described the move as a necessary “reset” for Xbox as it navigates an increasingly competitive marketplace.
Xbox CEO Asha Sharma, who stepped into her role leading the gaming division earlier this year, addressed the situation directly in an internal memo. “Our business today is not healthy,” Sharma wrote, adding that the division is “operating at margins that are 3-10x lower than comparable platform and publishing businesses.”
Sharma also pointed to a broader challenge affecting the entire gaming hardware industry, describing it as a severe “hardware crisis” driven by skyrocketing costs for console components. Xbox competes directly with Sony’s PlayStation and Nintendo’s Switch in the gaming console market.
