The Reaper is Coming to XBOX Again as New Layoffs Loom Large

It’s no secret that the gaming industry has been absolutely rife with layoffs this year. As the immense gains from the COVID-induced gaming boom have all but dried up, major companies are working feverishly to pare back acquisitions and workforces in order to return to some semblance of equilibrium.

Perhaps unsurprisingly, one of the companies that made the most aggressive acquisitions and expansions during that period, XBOX, has been undergoing one of the most concentrated downsizing efforts of all, and it’s nowhere close to being finished.

According to a new report published in Fortune Magazine and corroborated by Eurogamer, XBOX will be enacting another three rounds of layoffs throughout the company and its subsidiaries, extending out into the beginning of 2027. All of this, according to those allegedly in the know, is part of current XBOX CEO Asha Sharma’s ongoing efforts to “reset” the brand, returning it to a state of consistent net profitability.

Three More Rounds of Layoffs Could Start as Soon as This Month

According to the report, the first round of layoffs could begin as soon as this month, and considering there are less than two weeks left in this month, this could be quite a blindside for those in the company. Following this initial round, the second round is slated to run in November, and the final round will run around January 2027.

The report doesn’t clarify exactly how many jobs will be culled, either in the individual rounds or altogether. XBOX’s previous rounds of layoffs over the past year have been a bit inconsistent in this regard; the most recent bout of layoffs this past September only culled about 268 positions, while the layoffs that were conducted in July were much larger in scope, immediately scrapping around 1,600 positions with another 1,600 earmarked for gradual disposal over the course of subsequent months into early 2027.

The first round of layoffs could begin as soon as this month.

Presumably, these next three rounds will be the period when those 1,600 positions are officially scrapped, though the precise plans and numbers are still subject to change.

It’s Anyone’s Guess What the Division Will Look Like at the End

Somewhat frustratingly, the report doesn’t clarify where exactly these layoffs will be going down, nor which subdivisions and studios will be affected. Any of XBOX’s subdivisions could be on the block for cutbacks or rearrangement; during the previous layoff rounds in September, for example, Obsidian officially came under the umbrella of Bethesda rather than being a separate subdivision, while Rare and World’s Edge were rolled into Activision’s stable.

Even studios that have just released new games may not be safe from the reaper’s sickle. Employees from The Coalition, which launched Gears of War: E-Day earlier this month to lighter than expected sales, spoke to Eurogamer in an interview earlier this month, expressing concerns that, considering both the lukewarm reception and the fact that the game is already done and dusted, XBOX may choose to wash its hands of the studio, at least partially. This could result in its employees being included in one of the layoff rounds, which would be unfortunate for both the obvious reason and because the timing of it could end up causing them to miss promised salary bonuses.

It’s difficult to discern what XBOX, as a brand, will look like when the dust settles in January 2027, especially considering that, just the other day, it was announced that the next-gen XBOX Helix game console will have a projected price range of $1,200 to $1,800 when it launches in the 2028 holiday season. The goal remains to get the company back in the black, but whether these cost-cutting and pricing decisions turn out to be an overcorrection, we can only hypothesize.

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