Microsoft Layoffs Extend Beyond Xbox, 3,200 More Jobs Cut
Microsoft announced an additional 3,200 job cuts in its Commercial Business segment, bringing total layoffs on July 6 to 4,800 across Xbox and other divisions, affecting 2.1% of its global workforce.
Microsoft has expanded its workforce reduction beyond the Xbox division, cutting an additional 3,200 jobs in its Commercial Business segment. The layoffs were announced on Monday, July 6, by Executive Vice President and Chief People Officer Amy Coleman. Together with the previously known Xbox cuts, the company is eliminating 4,800 positions, representing 2.1% of its global workforce.
The Commercial Business layoffs came as a surprise, as the earlier focus was on gaming. In the Xbox division, 1,600 employees were let go immediately, with another 1,600 expected to be laid off in the coming months. Additionally, Microsoft is spinning off four studios—Compulsion Games, Double Fine, Ninja Theory, and Undead Labs—and may close a fifth, Arkane.
These moves follow a warning from new Xbox CEO Asha Sharma and COO Matt Booty in a June 10 memo, citing overextension after a decade of studio acquisitions and poor hardware sales. Coleman’s blog post addressed the role of AI, stating that the eliminated jobs are not being immediately replaced by AI, but acknowledging that automation is changing work and employees must adapt.
The layoffs also come amid union activity: one week prior, Xbox union members under the Communications Workers of America urged Microsoft to negotiate good-faith job security measures. Microsoft has a history of recent cuts, having laid off 9,000 employees in July 2025 (including hundreds in Xbox) and 1,900 Xbox employees in early 2024.
