A little over three months after Microsoft closed its acquisition of Activision Blizzard, the tech giant is slashing the ranks of its gaming division.
Microsoft Gaming CEO Phil Spencer announced the layoffs in a memo to staff. He said as part of integrating Activision Blizzard with the rest of the gaming operations, “we have made the painful decision to reduce the size of our gaming workforce by approximately 1,900 roles out of the 22,000 people on our team.” That represents about 8.6% of Microsoft Gaming’s headcount (and less than 1% of Microsoft’s total workforce).
With the layoffs, Blizzard Entertainment president Mike Ybarra said he is leaving the company. “It’s an incredibly hard day and my energy and support will be focused on all those amazing individuals impacted – this is in no way a reflection on your amazing work,” Ybarra wrote on X.
Those “directly impacted by these reductions have all played an important part in the success of Activision Blizzard, ZeniMax and the Xbox teams, and they should be proud of everything they’ve accomplished here,” Spencer wrote in the memo. “We are grateful for all of the creativity, passion and dedication they have brought to our games, our players and our colleagues.”
Microsoft closed its $69 billion takeover of Activision Blizzard — the biggest-ever M&A deal in the gaming sector — in October 2023 following concessions Microsoft made to address regulatory objections in the U.K. Activision Blizzard’s franchises include Call of Duty, World of Warcraft, Guitar Hero and Diablo.
Following the deal close, Bobby Kotick stepped down as Activision Blizzard CEO at the end of December. Microsoft appointedMatt Booty, president of game content and studios, to oversee the Activision Blizzard teams.
“Looking ahead, we’ll continue to invest in areas that will grow our business and support our strategy of bringing more games to more players around the world,” Spencer wrote in the memo Thursday. “Although this is a difficult moment for our team, I’m as confident as ever in your ability to create and nurture the games, stories and worlds that bring players together.”
The Communications Workers of America, said CWA-represented employees at Microsoft-owned ZeniMax, Raven and Blizzard Albany divisions will not be affected by the job cuts but urged video game workers to unionize to protect their interests.
“Layoffs in the video game industry are becoming the norm, even at companies that continue to deliver huge profits,” Wayne Dayberry, senior quality assurance tester at ZeniMax and a member of ZeniMax Workers United-CWA. “It hurts to see our coworkers, who are so passionate about this work, who actually make these video game companies so successful, be the first impacted by any cuts or layoffs at work… Union representation can’t always protect against layoffs, but through union representation and the bargaining process, video game workers can establish greater transparency and policies that put our needs first, including layoff protections.”
