Impacted teams include Activision Blizzard, Xbox, and ZeniMax.
Text: Xbox + Activision Blizzard King. Image: Four characters from Xbox and Activision Blizzard Games including Master Chief, Ghost from Call of Duty, Tracer from Overwatch, and some other character.

Layoffs are happening again within Microsoft as roughly 1,900 employees are being let go. The initial report comes from an IGN report that says the layoffs hit Microsoft owned Activision Blizzard, Xbox, and ZeniMax.

Xbox lead Phil Spencer sent out a memo to staff which announced these layoffs. In the memo, Spencer says that as Microsoft is "committed to aligning on a strategy and an execution plan with a sustainable cost structure that will support the whole of our gaming business". This apparently means that Microsoft has deemed it necessary to cut 1,900 employees from its "gaming workforce".

Spencer's memo says that it was a "painful decision" for the company to make. He also says that Microsoft will provide "severance benefits informed by local employment laws" to those that are being laid off.

Here is Spencer's memo in its entirety.

It’s been a little over three months since the Activision, Blizzard, and King teams joined Microsoft. As we move forward in 2024, the leadership of Microsoft Gaming and Activision Blizzard is committed to aligning on a strategy and an execution plan with a sustainable cost structure that will support the whole of our growing business. Together, we’ve set priorities, identified areas of overlap, and ensured that we’re all aligned on the best opportunities for growth.

As part of this process, we have made the painful decision to reduce the size of our gaming workforce by approximately 1,900 roles out of the 22,000 people on our team. The Gaming Leadership Team and I are committed to navigating this process as thoughtfully as possible. The people who are directly impacted by these reductions have all played an important part in the success of Activision Blizzard, ZeniMax and the Xbox teams, and they should be proud of everything they’ve accomplished here. We are grateful for all of the creativity, passion and dedication they have brought to our games, our players and our colleagues. We will provide our full support to those who are impacted during the transition, including severance benefits informed by local employment laws. Those whose roles will be impacted will be notified, and we ask that you please treat your departing colleagues with the respect and compassion that is consistent with our values.

Looking ahead, we'll continue to invest in areas that will grow our business and support our strategy of bringing more games to more players around the world. Although this is a difficult moment for our team, I'm as confident as ever in your ability to create and nurture the games, stories and worlds that bring players together.

In addition to this huge wave of layoffs, Blizzard president Mike Ybarra announced that he is leaving the company. Ybarra was a former executive at Xbox until joining Blizzard in 2019. Ybarra posted a full statement to Twitter.

I want to thank everyone who is impacted today for their meaningful contributions to their teams, to Blizzard, and to players’ lives. It’s an incredibly hard day and my energy and support will be focused on all those amazing individuals impacted – this is in no way a reflection on your amazing work. If there’s anything I can help with, connections, recommendations, etc., DM me.

To the Blizzard community: I also want to let you all know today is my last day at Blizzard. Leading Blizzard through an incredible time and being part of the team, shaping it for the future ahead, was an absolute honor. Having already spent 20+ years at Microsoft and with the acquisition of Activision Blizzard behind us, it’s time for me to (once again) become Blizzard’s biggest fan from the outside.

To the incredible teams at Blizzard - thank you. Words can’t express how I feel about all of you. You are amazing. Continue to do incredible things and always keep Blizzard blue and the player at the forefront of every decision.

To all of those impacted today - I am always available to you and understand how challenging today’s news is. My heart is with each one of you.​
Allen Adham, Blizzard's chief design officer and co-founder, is also leaving the company.

More broadly speaking, a survival game that has been in development at Blizzard for a while now is also cancelled. That game was known internally as Odyssey.

Sources also said that the gaming divisions within Microsoft "already suffered significant cuts to marketing budgets". These budget cuts came ahead of the layoffs today.

All of this comes roughly a week following the Xbox Developer Direct, a showcase hosted and presented by developers at various first-party Xbox studios. It also comes a mere three months after Microsoft finalized their $69 billion deal to acquire Activision Blizzard.