Three months after completing its $68.7 billion acquisition of gaming company Activision Blizzard, Microsoft is laying off 1,900 employees in its gaming divisions. That’s about 8.6% of Microsoft’s 22,000 gaming employees. Blizzard president Mike Ybarra has also announced that he will be stepping down now that the acquisition has been finalized.
“I want to thank everyone affected today for their significant contributions to their teams, to Blizzard, and to the lives of players,” said Ybarra told X. “It’s an incredibly difficult day and my energy and support will be focused on all the amazing people affected – this is in no way a reflection of your amazing work.”
According to one internal note from Microsoft Gaming CEO Phil Spencer, first obtained by The Verge, the layoffs are part of “an execution plan with a sustainable cost structure” that “identified areas of overlap” after the acquisition. Microsoft confirmed the legitimacy of The Verge’s reported memo in an email to TechCrunch.
“We will provide our full support to those affected during the transition, including severance benefits informed by local employment law,” Spencer’s memo said. “Those whose roles will be affected will be notified and we ask that you treat your departing colleagues with the respect and compassion consistent with our values.”
In just a few weeks, this year has already proven to be brutal for the gaming industry. So far, League of Legends maker Riot Games 530 workers were laid off. Game engine Unity laid off 1,800 people (25% of the company). The discord cut 170 jobs (17%). and Amazon-owned Twitch laid off 500 people (35%), after already laying off hundreds of employees in two rounds of layoffs last year.
According to game developer and consultant Rami Ismail, around 5,600 gaming employees have been laid off so far in 2024. That’s more than half of all gaming layoffs since 2023.
The rest of the tech industry hasn’t been spared either, with companies like Google, Amazon, TikTok and others making cuts. But according to data from tech layoffs in 2023, it appears that January is the most brutal month for layoffs.
In recent years, some divisions of Microsoft and Activision have created some of the first game unions in the country.
“With a union, employers are required to negotiate the impact of layoffs,” the Communications Workers of America, which represents unionized workers, told TechCrunch. “While CWA-represented members at Zenimax, Raven and Blizzard Albany will not be affected by these cuts, we are devastated that the lives of so many dedicated and talented video game workers will be disrupted.”
Updated, 1/25/24, 12:10 p.m. ET with comment from the CWA.
