Xbox announces major layoffs and cost‑cutting reset

Xbox senior vice president Ashi Sharma has outlined a "reset" plan for the division, targeting a significant reduction in staff beginning in July after Microsoft’s fiscal year close. The internal memo cites an accountability margin of only 3 % for Xbox, after the division spent more than $20 billion on content, platforms and hardware while revenues fell by nearly $500 million over the past five years.

Sharma’s 100‑day plan also calls for deep cuts to marketing budgets and a review of the studio portfolio, while development of the next‑generation console, Project Helix, will continue. Rising costs for memory and storage components are cited as an additional pressure on the business.

The restructuring follows a broader trend of layoffs across the video‑game industry and reflects Microsoft’s effort to improve profitability after the costly Activision Blizzard acquisition.