Microsoft's Supportive Approach Amidst Layoffs Post Activision Blizzard Merger

In a heartfelt message to the team, Phil Spencer, head of Microsoft Gaming, shared Microsoft's commitment to supporting employees affected by the upcoming layoffs following the merger with Activision Blizzard. This message, obtained by IGN, reassures staff that Microsoft will provide full support, including severance benefits in accordance with local employment laws, to those impacted.

Spencer emphasized that this decision was the result of collaborative efforts between the leadership teams of Microsoft and Activision Blizzard. Together, they have worked to prioritize, identify areas of overlap, and align on growth opportunities.

The recent news also brings confirmation of the departure of Blizzard president Mike Ybarra and chief design officer Allen Adham from the company, as reported by The Verge. Additionally, Blizzard's anticipated survival game, led by former Ubisoft Far Cry head Dan Hay, has been canceled as part of the adjustments following Microsoft's acquisition of Activision Blizzard for $69 billion.

In an email to the team, Phil Spencer reiterated the dedication of both Microsoft Gaming and Activision Blizzard leadership to develop a strategy and execution plan with a sustainable cost structure to support the expanding business. The focus has been on setting priorities, identifying overlaps, and ensuring alignment on optimal growth opportunities.

Despite the challenging news, there remains uncertainty among employees about who will be affected. Updates are expected to be provided through Bloomberg's coverage here: https://t.co/EFrb5W1afY - as shared by Jason Schreier (@jasonschreier) on January 25, 2024.

This announcement of layoffs at Microsoft follows a similar event just a year prior when the company announced job cuts within its gaming teams. In January 2023, Microsoft confirmed plans to lay off approximately 10,000 employees, amounting to about 4.5% of its vast 220,000-person workforce.

The gaming industry has been no stranger to job losses, with an estimated 9,000 layoffs reported in 2023 alone. This trend seems to continue into the current year without signs of slowing down.

In a statement regarding the layoffs, Phil Spencer expressed, “As part of this process, we have made the painful decision to reduce the size of our gaming workforce by approximately 1,900 roles out of the 22,000 people on our team. The Gaming Leadership Team and I are committed to navigating this process as thoughtfully as possible."

He continued, "The individuals impacted by these reductions have all played significant roles in the success of Activision Blizzard, ZeniMax, and the Xbox teams. We are grateful for the creativity, passion, and dedication they have brought to our games, our players, and our colleagues."

Mike Ybarra (@Qwik) shared a tweet on January 25, 2024, acknowledging the hard day and expressing gratitude to those affected for their contributions. He stated, "We will provide our full support to those who are impacted during the transition, including severance benefits informed by local employment laws."

Spencer also emphasized the importance of treating departing colleagues with respect and compassion consistent with the company's values.

Looking towards the future, Spencer reassured the team, “Looking ahead, we’ll continue to invest in areas that will grow our business and support our strategy of bringing more games to more players around the world."

Despite the difficult nature of the situation, Spencer expressed confidence in the team's ability to create and nurture games, stories, and worlds that bring players together.

The impact of these layoffs is evident across the gaming industry, as highlighted by a GDC survey of 3,000 developers. The survey reveals that approximately one-third of developers experienced layoffs at their workplaces over a 12-month period. Among respondents, 7% reported personal layoffs, 17% noted layoffs among colleagues in their department, and 11% observed layoffs in other teams or departments within their organizations.