Microsoft has announced plans to reduce its workforce by 10,000 employees, in an effort to cut costs and consolidate business. The move will impact 4.5% of current employees, with layoffs set to take place by the end of the company’s third fiscal quarter, ending March 2023.
In addition to cutting jobs, Microsoft will also reportedly make changes to its hardware portfolio. This is to contend with ‘macroeconomic conditions and changing customer priorities,’ according to the company. Employees working for Microsoft’s gaming division, in studios like Bethesda and Xbox, are expected to be impacted by these changes.
Bloomberg reports Bethesda Game Studios (The Elder Scrolls, Fallout) and 343 Industries (Halo) have been directly hit with layoffs, as well as Microsoft’s HoloLens team, and well as its engineering divisions. It’s believed that those working on single-player experiences, like the Halo Infinite campaign, have also been heavily impacted.
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Kotaku further claims that developers at The Coalition (Gears of War) have been caught in layoffs, likely impacting work on the studio’s newest IP, and the future of the Gears of War franchise.
According to Business Insider, Microsoft targeted employees believed to be ‘underperforming’ in its reduction process – although the metrics and practicalities of these decisions are unclear.
How these layoffs will impact Microsoft in the long term is similarly vague. Given that game development studios have been caught in structural changes, we can assume that work on upcoming titles like The Elder Scrolls 6 and Fallout 5 will be slowed or reshaped – however, given these titles are still several years away, we’re unlikely to learn of how these layoffs will impact existing plans.
Our thoughts are with those impacted by Microsoft’s restructuring.