Microsoft Cuts 4,800 Jobs in Xbox's Largest-Ever Reorg Amid AI Push
智东西 · wechat · 2026-07-07
Microsoft announced layoffs of about 4,800 employees (2.1% of its global workforce), primarily impacting Xbox (1,600 cuts today, totaling 3,200 by FY2027) and commercial sales. The CHRO emphasized that roles aren't being replaced by AI, though AI is changing how people work, noting that over 4,000 employees were internally transitioned over the past year. Alongside the layoffs, Microsoft launched the FrontierCompany division focusing on enterprise AI deployment with a $2.5 billion investment. Xbox's CEO admitted the division's profitability is unhealthy, announcing plans to flatten management layers from up to 14 down to 3-5, and transferring four game studios to new management. With nearly 154,000 tech jobs lost in H1 of this year, simultaneous layoffs and increased AI investment have become a shared trend among tech giants.
Related event: Microsoft Cuts 4,800 Jobs Amid $190B AI Push(8 posts)→
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