Microsoft Cuts 4,800 Xbox Jobs in Major Restructuring

Microsoft (MSFT) announced the layoff of 4,800 employees in its Xbox division and the closure of four game studios, as part of a major restructuring led by incoming CEO Asha Sharma. The move is aimed at focusing publishing efforts on just six core labels.

Details of the Change

Asha Sharma, who recently took the helm, confirmed that the company will shift to a more streamlined operational model, eliminating thousands of jobs and shutting down studios that were working on multiple projects. The names of the closed studios and the exact distribution of layoffs have not been disclosed.

Asha Sharma's Background

Asha Sharma is the new CEO of Xbox, taking over at a critical time for the gaming market. She previously oversaw content strategy at Microsoft and has experience managing large-scale transformations.

Reasons for the Change

According to the official statement, the restructuring aims to improve efficiency and focus resources on the most profitable labels. The decision follows a comprehensive review of studio performance and project pipelines, leading to a reduction from 10 to 6 publishing labels.

Impact on the Company

The changes are expected to significantly reduce costs, but may also affect employee morale and Xbox's ability to develop exclusive titles. The studio closures raise concerns about the future of certain franchises.

Market Reaction

No immediate market reaction was reported following the announcement, but investors are closely watching the impact on Microsoft's gaming division earnings.