In light of the mass layoffs taking place at Xbox as a whole, Blizzard Entertainment president Johanna Faries has reportedly sent out an email to staff members discussing the difficult day at the company as a whole. According to Windows Central’s Jez Corden, Faries said in the email that more information about how Xbox’s decisions will affect Blizzard will be revealed later.
“Blizzard, [Xbox CEO] Asha [Sharma] shared updates regarding a planned reset across Xbox, with many colleagues across the division being impacted,” reads the reported email. “While you can expect to hear more details regarding the day’s events and what they mean for Blizzard in further communications, for now, I simply want to acknowledge that today is a difficult day that impacts many people in a range of ways.”
“Please take care of yourself and others in this moment as best as possible. In light of today’s news, I want to thank everyone across Blizzard for moving with focus and creativity behind our strategic priorities, supporting our myriad communities and each other throughout. We continue to build upon that very strong foundation. Thank you for your continued collaboration in these highly dynamic times.”
Corden has noted that Blizzard is quite safe from Xbox’s layoffs and larger structural changes, at least for now, with layoffs described as “comparatively minimal”. This comes down to the fact that the company wants to focus its efforts on the bigger franchises and IPs that it owns, which would likely include Blizzard franchises like Diablo, StarCraft, and Warcraft. The report also indicates that there are plans for cross-media adaptations of Blizzard’s various IPs, which could include TV and film projects. BlizzCon 2026 is also expected to go ahead as planned.
Sharma had confirmed, however, that there are plans for further job cuts throughout Xbox, totalling up to around 3,200 for the entire fiscal year. With approximately 1,600 cuts having taken place this week, it means that we’re just halfway through.
On the subject of the layoffs, Sharma said in a recent interview that the decision was made due to the fact that the company had made several bets that had failed to pay off. This, in turn, led Xbox to spread itself “too thin” while also ignoring the growth of its core businesses.
“In order to grow, we made a bunch of bets … and as we did that, we inherently didn’t focus on the core business,” she said. “The number one measure of your strategy is what you put your resources behind, and we simply spread ourselves too thin.”
Along with the layoffs, Microsoft is also releasing four of the studios it owns – Undead Labs, Compulsion Games, Ninja Theory, and Double Fine Productions. Undead Labs and Ninja Theory are being sold to another company, while Compulsion Games and Double Fine will be spun off into independent studios. The company is also taking a look at Arkane games and is currently reviewing “potential strategic options”. Interestingly, the studio’s original founder, Raphael Colantonio, has jokingly asked Sharma how much the studio would cost. “I’m asking for a friend,” he wrote on social media.
