Resetting Xbox
Points and comments are a snapshot, not live.
Microsoft's Xbox division will eliminate 3,200 roles, spin off four studios, and restructure.
Xbox head Asha announced a major restructuring, cutting about 3,200 jobs in FY27, with 1,600 immediate layoffs and four studios separated: Compulsion Games and Double Fine return to independent status with their IP; Ninja Theory and Undead Labs will join new ownership to finish Senua and State of Decay 3; Arkane in France is consulting on options. The company cited unhealthy margins (3-10x lower than peers), a hardware crisis, and 64-cent losses per dollar invested in studios. A new COO role will consolidate operations, management layers will shrink to at most five, and vendor spend will be halved.
What commenters are saying
Commenters are split: many see the cuts as a profit-driven fix that won't address underlying issues like Game Pass devaluing games or bloated budgets, while others note Microsoft's losses on studio investments justify retrenchment. Specific criticism targets Game Pass for cannibalizing sales (citing a $300 million loss on Call of Duty) and the poor returns on high-budget titles like South of Midnight. Skeptics argue Microsoft will repeat past mistakes with more microtransactions and rushed sequels, though some point to the spin-offs as a positive outcome for studios like Double Fine.