Xbox to Cut 3,200 Jobs as Microsoft Restructures Gaming Divisions

A Sharp Contraction in Redmond

Microsoft is cutting 6,400 positions across its gaming division, a move that signals a profound restructuring of the company’s interactive entertainment arm. Of those layoffs, 3,200 roles are specifically tied to the Xbox organization, according to reports from E24, Gamereactor, and Gamer.no. This reduction represents a significant contraction for the technology giant’s gaming business.

Targeted Cuts and Studio Stability

Some clarity has emerged amid the uncertainty. Reporting from Gamer.no indicates that Obsidian Entertainment is not among the studios slated for closure, offering a measure of security for the high-profile RPG developer.

External Partnerships Remain Shielded

Despite the internal upheaval, high-profile projects involving external partners appear to be operating without interruption. Pressfire reports that Hideo Kojima’s upcoming title, OD, remains unaffected by the reorganization. This confirms that the partnership between Kojima Productions and Microsoft persists, even as the parent company downsizes its internal workforce.

The Push for Studio Independence

The restructuring extends beyond simple headcount reductions, marking a shift in the operational status of key subsidiaries. Both Double Fine and Compulsion Games are reportedly working to reclaim their status as independent entities. This move signals a definitive departure from their previous integration into the Microsoft-owned studio network.