February 3, 2023

Bobbys Brane

Bobbys Brane – Business & Tech Blog

Microsoft Laying Off 10K People ‘Hurts’

2 min read

Phil Spencer speaks in front of an Xbox logo.

Photo: Patrick T. Fallon (Getty Images)

A few hours ago, Xbox CEO Phil Spencer sent out a company-wide email to all full-time employees under Microsoft’s gaming divisions. A copy of the email was shared with Kotaku by a current Xbox employee, we have confirmed its authenticity, and the full text has been transcribed below:

This has been a difficult week across Microsoft, and here, inside our teams. Now that many of the 1:1 and team conversations have happened, I want to take a moment to reiterate the message that you heard from your leaders.

This is a challenging moment in our business, and this week’s actions were painful choices. The Gaming Leadership Team had to make decisions that we felt set us up for the long-term success of our products and business, but the individual results of those decisions are real. I know that hurts. Thank you for supporting our colleagues as they process these changes.

Over the coming weeks we will have many opportunities to connect and answer your questions, including the Monthly Gaming Update next week for teams who attend that meeting, and I am in close contact with teams at ZeniMax to provide support. The GLT and I are committed to being as transparent as we can. Moving forward with ambiguity is challenging, but I am confident that together, we will get through this difficult moment in time.

Xbox has a long history of success thanks to the work you do in service of players, creators, and each other. Your work is so deeply appreciated and valued in these times of change and is integral to our business momentum. I am confident in our future and proud to be part of this team, but also conscious that this is a challenging time and I want to thank you for everything you do here.

Phil

On January 18, Microsoft laid off 10,000 employees across the company. These layoffs included gaming studios such as 343 Industries, The Coalition, ZeniMax Media, and Bethesda Game Studios. Xbox has struggled to release first-party titles last year, and is under tremendous pressure to ship flashy blockbuster titles such as Starfield. Some of the people who have lost their jobs include senior talent, and occurred a year after the publisher scourged up the pocket change to purchase Activision Blizzard for $70 billion. Kotaku has reached out to Microsoft for a statement, but did not receive a response by the time of publication.

“This feels like something you send out on obligation,” wrote a current employee at Xbox over text messages to Kotaku. “I seriously doubt any of those monthly gaming updates or other meetings are going to do anything to make anyone feel better.”

The tech workers’ union CODE-CWA put out a statement on January 19, stating that their representatives have been in contact with Microsoft. The company “recognizes its obligation to bargain over any proposed layoffs of CWA members at ZeniMax.” The ZeniMax union intends to negotiate on “alternatives to layoffs.”