Microsoft plans significant Xbox layoffs after fiscal year end as gaming revenue declines
Xbox staff are bracing for job cuts. Microsoft $MSFT plans significant layoffs in its gaming division after the fiscal year ends June 30, new Xbox chief Asha Sharma told employees, citing thin margins and falling revenue. Gaming revenue fell $1.1 billion, or 6%, with Xbox hardwar
Microsoft is preparing significant job cuts in its Xbox division, and employees are being told the current path cannot hold. According to reporting from Bloomberg and GeekWire, the company announced plans for layoffs on June 10, with cuts expected shortly after its fiscal year ends on June 30. The exact number of affected roles has not been disclosed, and Xbox also intends to reduce marketing and operational budgets. In a memo to staff, new Xbox chief executive Asha Sharma, roughly 100 days into the job, delivered a blunt assessment: heavy spending paired with thin margins and declining revenue cannot continue. The numbers underline the pressure. Microsoft $MSFT reported that gaming revenue fell by $1.1 billion, or 6%, driven by declines in Xbox hardware and in content and services, with hardware revenue alone dropping 31% on lower console sales. Sharma's memo described a business that has spent heavily over five years while revenue slipped and margins thinned to a low single-digit figure. The reset marks a sharp change in tone for a division that Microsoft built up through major acquisitions, and it signals a renewed focus on profitability over scale.