Microsoft is laying off as many as 9,000 employees
BREAKING: 9,000 Jobs GONE! Microsoft’s SHOCK Layoffs Hit XBOX, Everwild Canceled & Gaming Futures HANG IN BALANCE!
🚨 JUST IN on July 2, 2025: Microsoft has rocked the tech world yet again, confirming a staggering 9,000 employees are being cut in a massive, global restructuring! The tremors are being felt most acutely across its colossal Xbox gaming division, with beloved studios like King (Candy Crush) and ZeniMax facing brutal reductions, and the highly anticipated Everwild from Rare officially DEAD after years in development!
This isn’t just about numbers; it’s about the future of gaming itself. While Microsoft rakes in billions in profit, why are they gutting teams and axing projects? What does Xbox CEO Phil Spencer’s cryptic memo really mean for upcoming releases and your favorite gaming experiences? Dive into the full, unvarnished truth as the gaming industry holds its breath!
Table of Contents
REDMOND, WA – Microsoft announced a fresh wave of major layoffs today, impacting approximately 9,000 employees globally, representing less than 4% of its massive workforce. The news, revealed as the company steps into its fiscal year 2026, marks the latest and most significant round of job cuts in what has been a tumultuous year for the tech giant.
Sources close to the company indicate these sweeping reductions are part of a broader “efficiency push” aimed at “removing layers of management to increase agility and effectiveness.” This strategic realignment is occurring despite Microsoft reporting robust financial results, including nearly $26 billion in net income on $70 billion in revenue for its most recent quarter.
Xbox Division Hit Hard: Studios & Projects Affected
The Microsoft Gaming division, led by Xbox CEO Phil Spencer, is reportedly bearing the brunt of these unprecedented cuts. Gaming fans are reeling from confirmed impacts across several key studios:
- King Division: The Barcelona-based mobile game powerhouse behind Candy Crush is slashing roughly 10% of its staff, impacting around 200 employees.
- ZeniMax: European offices and other regional teams within the Bethesda Softworks parent company are also facing significant reductions. Reports suggest a new MMORPG project from ZeniMax Online Studios, codenamed “Blackbird,” has also been scrapped.
- Rare: The veteran UK-based developer, known for Sea of Thieves, has been heavily affected. Most notably, sources confirm that Everwild, Rare’s long-in-development fantasy adventure game first announced in 2019, has been officially canceled. This comes after over a decade of work and previous reassurances from Spencer about its progress.
In an internal memo to all gaming staff, obtained by the press, Phil Spencer acknowledged the difficult nature of these decisions:
“Today we are sharing decisions that will impact colleagues across our organization. To position Gaming for enduring success and allow us to focus on strategic growth areas, we will end or decrease work in certain areas of the business and follow Microsoft’s lead in removing layers of management to increase agility and effectiveness1.”
Spencer’s memo notably attempts to balance the grim news with optimism for the future: “I recognize that these changes come at a time when we have more players, games, and gaming hours than ever before. Our platform, hardware, and game roadmap have never looked stronger.” He stressed that these “tough decisions” are necessary for “continued success in future years” and to “prioritize the strongest opportunities.”
A Pattern of Cuts Amidst Prosperity
These layoffs are not an isolated event. Microsoft employees have faced a series of workforce reductions over the past year:
- January 2025: Less than 1% of headcount cut, performance-based.
- May 2025: Over 6,000 jobs slashed, primarily in software engineering.
- June 2025: An additional 305 reductions.
- Earlier Cuts (2024): Including 1,900 Activision Blizzard and Xbox employees in January 2024, studio closures in May 2024, 1,000 HoloLens and Azure cloud team jobs in June 2024, and 650 more Xbox employees in September 2024.
When combined, Microsoft has cut over 15,000 roles in just the first half of 2025, signaling a deeper organizational reshaping rather than financial distress. Analysts note that these layoffs coincide with Microsoft’s heavy investment in Artificial Intelligence, leading to speculation that AI automation may be influencing staffing needs.
Microsoft has affirmed that affected employees will receive severance benefits, healthcare coverage, and job placement resources, with priority review for those exploring other open positions within Microsoft Gaming.
The company’s stock closed at a record high of $497.45 per share on June 26, further highlighting the paradox of significant layoffs occurring during periods of strong financial performance and market valuation. The tech industry as a whole is seeing a trend of “slimming down,” with companies like Autodesk, Chegg, and CrowdStrike also announcing cuts in 2025.
As Microsoft navigates this massive restructuring, the question remains: will these painful cuts truly lead to greater agility and “enduring success,” or will they leave lasting scars on employee morale and the future of its ambitious gaming empire? Only time will tell.
Read about Recent Tech News Here…