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Microsoft’s Xbox division is undergoing significant changes as the company consolidates teams, closes multiple gaming studios, and implements layoffs in a bid to cut costs and streamline operations amidst a slowdown in the gaming sector.
According to reports, Microsoft is set to close several gaming studios under its Xbox brand, including the renowned Arkane Austin. This restructuring effort is part of a broader strategy aimed at optimizing resources and refocusing on key priorities within the gaming industry.
Matt Booty, the head of Xbox Game Studios, revealed in an internal memo that Tokyo-based Tango Gameworks, known for creating “Hi-Fi Rush,” and Canada-based Alpha Dog are among the studios facing closure. However, the exact number of employees affected by these changes has not been disclosed.
The decision to close studios and lay off employees is intended to streamline operations and reallocate resources to support Xbox’s game portfolio while fostering new intellectual property development. Booty emphasized that this “reprioritization of titles and resources” aligns with Microsoft’s commitment to innovation and future growth in the gaming sector.
Despite these restructuring efforts, Microsoft’s Xbox content and services segment reported a significant 62% revenue increase in the third quarter, following the company’s acquisition of Activision Blizzard.
This move by Microsoft follows similar actions in the gaming industry, including Take-Two Interactive’s announcement of shutting down two subsidiary studios as part of a broader restructuring last week. Earlier this year, Microsoft initiated significant layoffs affecting 1,900 employees across Activision and Xbox divisions, reflecting ongoing changes and challenges within the gaming sector.
Sources By Agencies
