Xbox lays off 1,900 developers, cancels Blizzard’s survival game

Microsoft is laying off around 8% of its Gaming Workforce, affecting game developers across Xbox, ZeniMax Media, and the newly acquired Activision Blizzard.

The Verge reported on these layoffs Thursday morning, sharing an internal memo from CEO of Microsoft Gaming, Phil Spencer, that revealed Microsoft is laying off 1,900 of 22,000 employees this week. Spencer explains that Microsoft Gaming “set priorities, identified areas of overlap, and ensured that we’re all aligned on the best opportunities for growth,” following the acquisition of Activision Blizzard in October 2023, and decided to “reduce the size of our gaming workforce” as part of that process. Spencer says that Microsoft will give those laid off “severance benefits informed by local employment laws.”

Blizzard Entertainment is being hit particularly hard by this restructuring. Both Blizzard president Mike Ybarra and Chief Design Officer Allen Adham are leaving the company, and a previously teased survival game that Blizzard was working on has been canceled. In an internal memo obtained by The Verge, Microsoft’s Game Studios and Content President Matt Booty says that developers on that survival game project not laid off will be moved to “one of several promising new projects Blizzard has in the early stages of development.”

• The video game industry flew too close to the sun in 2023. Now, its crashing back to Earth
• Microsoft has acquired Activision Blizzard: What does that mean for you?
• Microsoft gives Activision Blizzard cloud gaming rights to Ubisoft

The video game industry has seen a massive amount of layoffs over the course of 2023 from companies like Embracer Group, Microsoft, and Bungie. This dour trend has unfortunately continued into 2024. Earlier this week, League of Legends‘ Riot Games laid off 530 workers, shutting down Riot Forge and putting Legends of Runeterra on the backburner in the process.