Update: Microsoft confirms it's laying off 650 game workers

Update (09/13/24): Microsoft has confirmed it's laying off 650 workers, or around 3 percent of its global workforce.

"We can confirm that what’s reported in Variety is accurate–we have nothing further to share," said the company in a statement sent to Game Developer. 

Much like Game File, Variety is reporting the cuts will impact employees in "corporate and supporting functions." The publication also states that Microsoft has downsized the Call of Duty: Warzone Mobile team by conducting layoffs and moving staff around internally. Some members of the Warcraft Rumble team have also been laid off.

Original story: Microsoft is cutting 650 roles across its video game division. That's according to Game File, which obtained an email sent to employees by Xbox boss Phil Spencer.

Spencer indicated the redundancies are a direct result of Microsoft's seismic merger with Call of Duty maker Activision Blizzard.

"As part of aligning our post-acquisition team structure and managing our business, we have made the decision to eliminate approximately 650 roles across Microsoft Gaming—mostly corporate and supporting functions—to organize our business for long term success," he wrote in the email.

"I know that this is difficult news to hear. We are deeply grateful for the contributions of our colleagues who are learning they are impacted. In the US, we're supporting them with exit packages that include severance, extended healthcare, and outplacement services to help with their transition; outside the US packages will differ according to location."

Microsoft has laid off thousands this year

Microsoft laid off 1,900 game workers in January, and stated those cuts would enable the company to align on a "strategy and an execution plan with a sustainable cost structure" after it spent $68.7 billion acquiring Activision Blizzard.

The latest cuts mean Microsoft has laid off around 2,550 people within its gaming division since the turn of the year. It also shuttered key ZeniMax studios Arkane Austin, Alpha Dog Games, and Tango Gameworks—the latter of which was eventually purchased by Krafton.

Echoing the statement he issued in January, Spencer said the latest cuts prioritize "sustainable future growth" and will enable Microsoft to "better support our studio teams and business units."

"Separately, as part of running the business, there are some impacts to other teams as they adapt to shifting priorities and manage the lifecycle and performance of games. No games, devices or experiences are being cancelled and no studios are being closed as part of these adjustments today," the email continues.

"Throughout our team’s history, we have had great moments, and we have had challenging ones. Today is one of the challenging days. I know that going through more changes like this is hard, but even in the most trying times, this team has been able to come together and show one another care and kindness as we work to continue delivering for our players. We appreciate your support as we navigate these changes and we thank you for your compassion and respect for each other."

Game Developer has reached out to Microsoft for comment.