More than $80 billion spent on studio acquisitions for Game Pass
Microsoft’s Xbox division is laying off about 3,200 employees and divesting five game studios, with CEO Asha Sharma calling for a “reset” of the business.
The cuts come after the company spent more than $80 billion to acquire game studios and bring major franchises including “Call of Duty” and “Fallout” onto its Game Pass subscription platform. Microsoft had bet on Game Pass as a way to compete in the console market, where it had been struggling to keep up with rivals, according to The Wall Street Journal.
The “reset” Sharma described signals a shift away from the strategy of making multibillion-dollar studio acquisitions and prioritizing Game Pass subscriptions that defined Xbox’s approach in recent years. The company is cutting roughly 3,200 positions and divesting five studios as part of the restructuring.
The Wall Street Journal reported on the scope of the spending and the layoffs. The Journal’s coverage noted that the future of fan-favorite franchises is a key question following the restructuring.