Microsoft to lay off nearly 2,000 employees in its gaming division, representing over 8% of its workforce, less than 3 months after acquiring Blizzard!

CNBC reported that Microsoft announced this week the layoffs of 1,900 employees from the gaming division, which includes Activision Blizzard and Xbox, nearly 9% of the total workforce in that division, following the acquisition of Activision Blizzard nearly 3 months ago. The former president and chief design officer of Blizzard will also depart, and unfinished games may also be affected.

Microsoft to Lay Off 1,900 Gaming Division Employees

According to a memo released on Thursday, tech giant Microsoft is set to lay off approximately 1,900 employees from its gaming division, accounting for about 8.6% of the total workforce in that division.

Phil Spencer, head of Microsoft's gaming division, stated that following the acquisitions of Activision, Blizzard, and King teams, the gaming division will restructure its organization and reduce business overlap:

To ensure the continued growth of our overall business, we will be reducing a total of 1,900 positions across Activision Blizzard, Xbox, and ZeniMax teams to maximize efficiency.

Previously, Microsoft announced the acquisition of Activision Blizzard for $69 billion in 2022, which was finalized at the end of last year. CNBC noted that layoffs are common after such large merger deals are completed.

Blizzard President and Chief Designer Departing

In addition, Blizzard President Mike Ybarra also revealed on Twitter yesterday, 25, that he will be leaving Microsoft and Blizzard:

I've spent over 20 years at Microsoft, and with the Blizzard acquisition completed, it's time for me to become Blizzard's biggest fan from the outside.

As the parent company of Activision Blizzard, Xbox, and ZeniMax, Matt Booty, head of Microsoft's gaming studios, also mentioned in an internal memo:

As you know, Mike's prior contributions to Microsoft and his role as President of Blizzard during the acquisition have led to his decision to leave the company, and we will announce the new head of the Blizzard team next week.

Furthermore, Matt also noted in the memo that Blizzard's Chief Designer, Allen Adham, will also be departing:

As one of the co-founders of Blizzard, Allen has had a significant impact on all of Blizzard's games, and he will continue to mentor young designers in the industry.

Unreleased Game Shelved

Due to significant organizational changes, a survival game that Blizzard was previously developing has been indefinitely suspended. The game, which garnered attention from its concept art, had never been publicly revealed in terms of its title and detailed content and is now shelved.

Matt explained:

Blizzard will be ending the development of its survival game and reallocating some of the project's staff to several promising new projects in early development stages.

Companies Announce Successive Layoffs

Two weeks ago, it was reported that not only in Web2 companies, but many Web3 teams have also been reporting layoffs and downsizing since the end of last year.

The former includes Google, Discord, Unity, and Twitch, while the latter includes Chainalysis, Polkadot, OpenSea, and Ava Labs, among others.

New Year Layoff Wave? Near Foundation to Lay Off 40%: Core Team Integration, Financial Situation Still Good