Microsoft layoffs: Xbox to shut down several gaming studios in cost-cutting effort

Tech giant Microsoft's Xbox has revealed its plans to shut down several gaming studios, including the renowned Arkane Austin amid a slowdown in gaming sector. This also comes as Microsoft positions itself as the latest publisher to undergo significant restructuring.

Layoffs by Microsoft

As per Reuters, the head of Xbox Game Studios Matt Booty in an internal memo disclosed that Tango Gameworks, the creator of "Hi-Fi Rush" and headquartered in Tokyo, along with Canada-based Alpha Dog, are among the studios facing closure. The scale of layoffs, however, is not disclosed yet.

As per Booty, the decision to streamline operations and shutter select studios aims to reallocate resources towards bolstering Xbox's game portfolio and nurturing new intellectual property. All the affected studios come under the umbrella of ZeniMax Media, which Microsoft acquired for $7.5 billion in 2021, alongside Bethesda.

Meanwhile, Microsoft's Xbox content and services segment reported a 62% jump in third-quarter revenue last month. This was largely driven by the Activision Blizzard acquisition.

As per Bloomberg, “Grand Theft Auto” maker Take-Two Interactive said it would shut down two subsidiary studios as part of a mass layoffs. At the start of the year, Microsoft had laid off 1,900 employees at Activision and Xbox

Also watch: Microsoft to cut 1,900 jobs across its video gaming divisions