Redmond, Washington — In a significant restructuring move, Microsoft has laid off approximately 9,000 employees, affecting various divisions, including hundreds from its Xbox gaming sector. The decision comes as part of an effort to allocate resources towards an ambitious investment in artificial intelligence, reportedly up to $80 billion. As part of these layoffs, several anticipated gaming projects have been cancelled, marking a notable shift for the company.
Among the casualties is “Perfect Dark,” a reboot developed by The Initiative, which has now been shuttered. Similarly, Rare has halted work on “Everwild,” leading to job losses for many veteran designers. The MMORPG in development by ZeniMax Online Studios has also been discontinued, despite positive initial impressions from Xbox CEO Phil Spencer.
Numerous second-party projects, which are games developed by external studios but funded by Microsoft, have faced cancellations as well. The upcoming shooter from Romero Games, for instance, has led to the disbandment of the studio following its cancellation. As other projects remain in limbo, some have been announced but have not seen updates for years, leaving their futures uncertain.
Despite these cutbacks, there is hope for one project, tentatively titled “OD,” which was teased nearly two years ago by acclaimed game designer Hideo Kojima. Speculation surrounded its status amidst the layoffs, but sources indicate it remains unaffected, at least for now. This situation highlights a broader trend, where Microsoft’s focus on artificial intelligence and emerging technologies appears to overshadow ambitious gaming ventures.
The high-profile cancellations have sparked concern among fans and industry observers. CEO Satya Nadella’s strategy suggests a willingness to sacrifice promising projects in favor of investments in cutting-edge technologies. As the fallout continues, the ramifications of these layoffs are likely to reverberate through the gaming community for a considerable time.
Additional projects, such as “Contraband,” have also raised eyebrows. Originally in development at Avalanche Studios, this heist-themed game has been notably absent from announcements, with its trailer recently removed from Xbox’s YouTube channel. Some speculate that the removal may relate to an expired music license, though the lack of updates is concerning.
As Microsoft navigates these turbulent changes, details about other cancelled projects and reduced commitments may soon emerge. The impact of this significant downsizing is already apparent, with reports from affected employees revealing feelings of shock and heartbreak. The extensive cutbacks within the gaming division not only affect those directly involved but also ripple through the broader gaming landscape. The future of Microsoft’s gaming initiatives now rests on how it balances its commitment to innovation in AI while maintaining a portfolio of engaging games for its audience.