Microsoft CEO Satya Nadella has expressed satisfaction with the ongoing "streamlining" efforts at Xbox, led by Xbox CEO Asha Sharma, while acknowledging the recent wave of layoffs and studio restructurings within the division. Nadella stated he feels "fantastic" about Xbox's current intellectual property and its potential for future game development.
Speaking on the Sources podcast, Nadella remarked on the "streamlining the team is doing, and Asha is doing, which is great to see." He emphasized Microsoft's goal to "invent the right sustainable business model that allows us to deliver gaming to more and more people," aiming to be a strong publisher and platform provider for games across PC and Xbox. Nadella added that the team's plan is for Xbox "to get back to growth this next fiscal year."
These comments come in the wake of significant organizational changes and job cuts within Xbox. Reports indicate a further 268 layoffs, with the potential closure of British studio Ninja Theory. Additionally, Obsidian Entertainment is reportedly moving under Bethesda's purview, Playground Games and Turn 10 Studios are merging, Undead Labs is becoming independent, and Rare, World's Edge, and the Halo studio are being integrated under Activision. Both Undead Labs and the Age of Empires developer World's Edge have also experienced substantial layoffs.
This follows an earlier announcement in July by Xbox CEO Asha Sharma regarding job cuts affecting 3,200 employees, described as the "most significant" restructuring in the company's history. At that time, 1,600 layoffs were immediate, and some first-party studios, including Double Fine and Compulsion Games, were allowed to pursue independence.