Microsoft Axes 1,900 Staff After Activision Acquisition

Microsoft has confirmed it is laying off more staff, in yet another jobs blow for the global tech industry.

In a Thursday memo to staff obtained by CNBC, Microsoft Gaming CEO Phil Spencer announced that it is laying off 1,900 workers out of the 22,000 people on in the gaming division. This represents 9 percent of the entire gaming division.

The move come three months after Microsoft closed on its $69 billion acquisition of Activision Blizzard, after receiving official approval from the UK competition regulator, the CMA.

Job losses

Besides the 1,900 staff being handed their P45s, Microsoft’s Phil Spencer also confirmed that Blizzard president Mike Ybarra is leaving the company.

Spencer said that the layoffs were part of a larger “execution plan” that would reduce “areas of overlap.”

“It’s been a little over three months since the Activision, Blizzard, and King teams joined Microsoft,” wrote Spencer. “As we move forward in 2024, the leadership of Microsoft Gaming and Activision Blizzard is committed to aligning on a strategy and an execution plan with a sustainable cost structure that will support the whole of our growing business.”

“As part of this process, we have made the painful decision to reduce the size of our gaming workforce by approximately 1900 roles out of the 22,000 people on our team,” he wrote. “The Gaming Leadership Team and I are committed to navigating this process as thoughtfully as possible.”

Spencer then offered the usual platitudes, commonly found with headcount reductions.

“The people who are 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,” he said. “We are grateful for all of the creativity, passion and dedication they have brought to our games, our players and our colleagues.”

Spencer said Microsoft would provide “full support” including location-dependent severance to all employees.

Other lay-offs

Microsoft’s announcement comes amid a slew of similar job cuts at other tech giants, including eBay, Google, TikTok, Salesforce and Amazon.

German software giant SAP this week also said it was “restructuring” 8,000 jobs.

Microsoft had already axed thousands of jobs in 2022 and 2023.

In May 2022 a senior Microsoft executive had warned the management of the Windows and Office divisions to adopt a more conservative approach to hiring new people.

Then in early July 2022 Microsoft cut less than 1 percent of jobs as part of an annual structural adjustment, which it said was routinely carries out every summer.

Later that same month Microsoft began withdrawing job openings in its Azure and security divisions, as its hiring slowdown extended to other divisions.

Then in October 2022 Microsoft confirmed a second round of job losses (reportedly under 1,000 jobs) across multiple divisions but did not confirm the actual numbers let go.

In January 2023 Microsoft said it was axing 10,000 jobs, or 5 percent of the workforce, and then in July 2023 confirmed further job losses in its sales and customer service roles.

It comes as Microsoft once again this week overtook Apple, when it became the world’s most valuable tech company after a rise in share price raised its market valuation above $3 trillion.