Xbox workers stunned after jobs 'bloodbath'

Key developments are emerging from the global stage. Xbox workers stunned after jobs 'bloodbath'Image source, BethesdaImage caption, Xbox bosses say they want to focus on their biggest series, such as FalloutByTom RichardsonBBC NewsbeatPublished17 minutes ago"Blindsided. "That was how game developer Morgan Goin felt when she found out she was being laid off from her job at Xbox-owned ZeniMax Online Studios (ZOS) last week. The senior encounter designer, who worked on popular fantasy role-playing game The Elder Scrolls Online, had known job cuts were coming.

For weeks, reports warning of a "bloodbath", external at Microsoft's video game studios had been circulating after the division's new chief executive, Asha Sharma, released a memo saying she planned to "reset the business", external. "We knew something was going to happen to somebody, but not who or how much," says Goin. About a month later, workers learned about 3,200 of them - an estimated 20% of the console-maker's staff - were being let go.

The Details

Half immediately, with the remaining 1,600 over the next 12 months. Xbox leadership has insisted the "painful" cuts across its sprawling network of studios are necessary to equip it for future success, as it pivots focus to its biggest blockbuster titles. The plan is to put more resources into its most popular series in the hope of getting new instalments out to fans sooner.

But former employees say the cuts have eliminated decades of talent and experience, and question whether the company will be able to achieve its aim of "a bigger future". Image source, Getty ImagesImage caption, Asha Sharma took over as Xbox CEO in February this yearLayoffs in the video game industry have been commonplace since 2022, with estimates suggesting nearly 58,000 roles have been cut , externalworldwide. Much of this is down to over-hiring and aggressive expansion around 2020, when the Covid-19 pandemic sparked a massive boom in player numbers and spending.

During this period, Xbox bought up multiple studios and publishers. Among its biggest purchases were ZeniMax/Bethesda, owner of the hugely popular The Elder Scrolls and Fallout series, and Call of Duty maker Activision Blizzard, which it purchased for $69bn (£56bn) in 2023. Video games remain profitable, but the cost of producing them has skyrocketed.

What Experts Say

Cost-of-living crises, customer habits and rising hardware costs blamed on massive investment in AI have all had an effect on the market. When Sharma's memo landed in early June, some staff, including Autumn Mitchell, started to worry. "People are reading in between the lines'," says the former senior quality assurance tester at ZeniMax.

Does it mean my project? Does it mean my studio? "Mitchell is one of four Xbox developers Newsbeat spoke to who lost their jobs in the latest cuts.

All of them are members of studio unions affiliated with the Communication Workers of America union (CWA).

The story has become one of the most prominent items on the global agenda.