Microsoft Lays Off Thousands and Divests Four More Xbox Studios
3 videos · score: 172,126 · first seen Jul 3, 2026
🟢 TRENDING UPMicrosoft announced 1,600 immediate layoffs and the divestiture of four Xbox studios, including Double Fine and Compulsion Games — creators highlight disagreements over whether the cuts signal a Game Pass strategy failure, a desperate leadership reset, or a crisis driven by poor console hardware margins.
Xbox dropped a BOMBSHELL
Microsoft's layoff of 1,600 Xbox employees and divestiture of Double Fine, Compulsion Games, Ninja Theory, and Undead Labs is framed by the creator as an admission that the Game Pass acquisition strategy failed, with new leadership's restructuring seen as a desperate reset.
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Microsoft Xbox announces 1,600 immediate layoffs, 3,200 total cuts, spins off Compulsion Games and Double Fine as independent studios, and begins a 100-day 'reset' amid unhealthy margins and a hardware crisis, with the creator arguing Game Pass has hit a ceiling on Xbox consoles and Microsoft is shifting away from it after Call of Duty failed to boost subscriptions.
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Microsoft's reported plan to cancel Marvel's Blade and lay off 1,000 employees is framed as a devastating blow to the Blade fandom and a historic gaming industry cut, with the creator reacting to breaking news from Tom Warren at The Verge.