Microsoft is laying off around 1,900 employees in its gaming division just weeks after completing its $69 billion acquisition of video game giant Activision Blizzard.
Phil Spencer, the CEO of Microsoft Gaming, circulated a memo to employees saying that the layoffs, which amount to around 8% of the division, will affect staffers at Xbox, Activision Blizzard and ZeniMax.
The memo was first obtained by the news site The Verge.
Spencer wrote in his memo that he and his team have “identified areas of overlap” since the software giant absorbed Activision Blizzard and its approximately 13,000 employees last year.
“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,” according to the memo.
Mike Ybarra, president of Activision Blizzard, will depart the company as part of the restructuring.
“As many of you know, Mike previously spent more than 20 years at Microsoft. Now that he has seen the acquisition through as Blizzard’s president, he has decided to leave the company,” according to Matt Booty, Microsoft’s game content and studios president.
Microsoft is expected to name a new president of its Activision unit next week.
Allen Adham, the chief design officer of Activision, is also departing, according to the company.
Several other big firms including Alphabet, Amazon and eBay have also laid off thousands of staff in recent weeks to lower costs and boost profitability.
Overall, more than 21,000 workers have been let go across 76 tech firms in January, according to tracking website Layoffs.fyi.
The tech sector shed 168,032 jobs in 2023 and accounted for the highest number of layoffs across industries, according to a report by Challenger, Gray and Christmas earlier this month.
That included more than 10,000 cuts at Microsoft.
With Post Wires