Microsofts Layoffs Hit Gaming Division Hard: Perfect Dark and Everwild Cancelled Amid 9,000 Job Cuts

Microsoft has initiated a new round of layoffs—its fourth in the past eighteen months. On Wednesday, the company began notifying employees about the job cuts.

According to The Seattle Times, the organization may lay off approximately 9,100 individuals, which accounts for 4% of its total workforce. The gaming division has been particularly hard hit, likely losing around 4,000 employees.

The revival of Perfect Dark has been scrapped, and the studio The Initiative has been shut down. This studio, based in Santa Monica, was established in 2018, and Perfect Dark marked its inaugural project.

A similar fate befell Rare, a well-respected studio with the long-awaited Everwild, which spent over a decade in development and has only released a few trailers during that time. The studio is expected to undergo a restructuring, with the departure of key figures, including director Gregg Mayles, who had been with the company for over 35 years, and producer Louise O’Connor, another Rare veteran.

An unannounced MMORPG that Zenimax Online has been working on since 2018 has also been canceled.

Additionally, studios working on the Call of Duty franchise have faced cuts. Specifically, layoffs occurred at Raven Software and Sledgehammer Games.

Turn 10, the studio behind the Forza Motorsport series, has seen its workforce cut by half.

In King, which develops the mobile game Candy Crush, about 200 employees—roughly 10% of its staff—have lost their jobs.

Here are some excerpts from an address by Phil Spencer, head of Microsoft Gaming:

“To position the company for long-term success and allow us to focus on strategic growth areas, we will cease or reduce operations in certain business segments, and follow Microsoft’s lead in eliminating unnecessary levels of management to enhance agility and efficiency.

Our platform, hardware, and game roadmap have never looked stronger. The success we are currently witnessing is built on tough decisions we made previously. We have to make choices now to thrive in the future, and a crucial aspect of this strategy is the discipline to prioritize the most promising opportunities.

Human resources are actively working with affected employees to provide severance packages (in accordance with local laws), which include salary, health insurance, and employment assistance. These employees are encouraged to consider open positions within Microsoft Gaming, where their applications will be prioritized.