Xbox Hit With Major Changes Amid Layoffs and Studio Spin-Offs



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More bad news in the gaming industry, this time from Microsoft. Following the crushing news that Sony and PlayStation are to do away with physical media in the near future, it seems the Xbox side of the aisle is also making some moves. Michrosoft is making a huge round of job cuts, with the gaming division set to be hit hardest by that move. CNBC is reporting that the company is going to be eliminating 4,800 jobs across its business, with 3,200 of those losses set to come from within Xbox through 2027.

For those who can’t quite process that horrific news, that amounts to roughly one fifth of the entire Xbox workforce, according to someone quoted within the CNBC report, and about 1,600 of those roles are being cut immediately, while the rest are expected to go over the next year as Microsoft clears the decks.

Xbox CEO Asha Sharma told employees that the changes would be staggered because “it is not possible to make all the necessary changes in a single day.” She added that the company expects to return to growth in 2027, though that’s hardly going to be a comfort to the teams that have just had their workforce slashed in dramatic fashion. Her statement concluded:

I want XBOX to be one of the few companies that entertains more than a billion people each day and gives everyone the opportunity to create and connect. I know we can achieve this goal. XBOX has many of the most beloved franchises in entertainment history, talented studios around the world, and we will return to growth in 2027.



















Collider Exclusive · Sci-Fi Personality Quiz
Which Sci-Fi Hero Are You Most Like?
Paul Atreides · Captain Kirk · Princess Leia · Ellen Ripley · Max Rockatansky

Five iconic heroes. Five completely different ways of facing an impossible universe. One of them shares your instincts, your values, and your particular way of refusing to back down. Eight questions will tell you which one.

🏜️Paul Atreides

🖖Capt. Kirk

Princess Leia

🔦Ellen Ripley

🔥Max Rockatansky

01

How do you lead when the stakes couldn’t be higher?
The way you lead under pressure is the most honest thing about you.





02

What is your greatest strength in a crisis?
The quality that keeps you alive when everything else fails.





03

What is the thing you’d sacrifice everything else for?
Your deepest motivation is your truest compass.





04

How do you relate to the people around you?
Who you are to others under pressure is who you really are.





05

You’re facing a threat that no one else believes is real. What do you do?
How you respond when you’re the only one who sees it defines everything.





06

What has your heroism cost you personally?
Every hero pays. The question is what — and whether they’d pay it again.





07

How do you feel about the rules of the world you’re in?
Every hero has a relationship with the system. What’s yours?





08

When everything is on the line, what keeps you going?
The answer is the most honest thing about you.





Your Hero Has Been Identified
Your Sci-Fi Hero Is…

Your answers point to the iconic sci-fi hero who shares your instincts, your values, and your particular way of facing the impossible.


Arrakis · Dune

Paul Atreides

You carry a weight most people would crumble under — the knowledge of what you’re capable of, and the burden of what you might have to become.

  • You see further ahead than others and you plan accordingly, even when the vision frightens you.
  • You are driven by loyalty to your people and a sense of destiny you didn’t ask for but can’t escape.
  • Paul Atreides is not simply a hero — he is someone who understands the cost of power and chooses to bear it anyway.
  • That gravity, that willingness to carry what others won’t, is exactly you.


USS Enterprise · Star Trek

Captain Kirk

You lead with instinct, warmth, and an absolute refusal to accept a no-win scenario — because you’ve always believed there’s a third option nobody else has thought of yet.

  • You take the mission seriously without ever taking yourself too seriously.
  • Your crew would follow you anywhere, not because you demand it, but because you’ve earned it.
  • Kirk’s genius isn’t tactical — it’s human. He reads people, bends rules with purpose, and wills outcomes into existence through sheer conviction.
  • That combination of warmth, audacity, and relentless optimism is unmistakably yours.


The Rebellion · Star Wars

Princess Leia

You are the kind of person who holds the line when everyone else is losing faith — not because you’re fearless, but because giving up simply isn’t something you’re capable of.

  • You lead through conviction. Your voice carries because your belief is unshakeable.
  • You gave up everything ordinary the moment you chose the cause, and you’ve never looked back.
  • Leia is not a supporting character in her own story — she is the moral centre of the entire rebellion.
  • That same fierce, principled, unbreakable core is what defines you.


The Nostromo · Alien

Ellen Ripley

You are not reckless, not grandiose, and not particularly interested in being anyone’s hero — you just refuse to stop when it matters.

  • You see threats clearly, you document the truth even when no one listens, and when the time comes you handle it yourself.
  • Ripley’s heroism is earned, not performed. She doesn’t have a speech — she has a flamethrower and a plan.
  • You share her composure under the worst possible pressure, and her refusal to pretend the monster isn’t there.
  • When it counts, you don’t flinch. That’s everything.


The Wasteland · Mad Max

Max Rockatansky

You have been through fire that would break most people — and what came out the other side is something the world underestimates at its peril.

  • You don’t ask for help, don’t need validation, and don’t wait for anyone to tell you the rules no longer apply.
  • Your loyalty, when it finally arrives, is absolute — but it’s earned in silence and tested in action, not in words.
  • Max is not a nihilist. He is someone who lost everything and found, against his will, that he still has something worth protecting.
  • That bruised, stubborn, ultimately human core is exactly yours.

What Does the Xbox Restructuring Involve?

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Also part of the restructuring is a plan to spin off four gaming studios from Microsoft. Compulsion Games and Double Fine Productions are set to become independent again, while Ninja Theory and Undead Labs have reportedly entered talks to join new ownership. In addition, there’s also real uncertainty over the future of Arkane Studios, which joined Microsoft through its $8.1 billion ZeniMax Media acquisition in 2021, and they are said to be in dicussions about strategic options but no final decisions have been made for the time being.

In news that is sure to be welcomed by, well, nobody, Microsoft chief people officer Amy Coleman said the company is responding to a workplace being reshaped by AI, though she insisted the technology itself is not directly replacing affected employees. “Some of the tasks we do every day can now be automated,” she wrote, adding that staff will need to “keep learning, keep building new skills, and keep adapting as the work evolves.”

Stay tuned to Collider for more updates.

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https://collider.com/xbox-studio-microsoft-layoffs-restructuring/


Chris McPherson
Almontather Rassoul

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