Microsoft has announced another round of layoffs, this time affecting around 650 employees within its gaming division. This move follows a significant round of cuts earlier this year, where 1,900 positions at Activision Blizzard and Xbox were eliminated, and the closure of several game studios, including Redfall developer Arkane Austin.

Phil Spencer, Xbox’s head honcho, broke the news to employees in an internal memo dated September 12th. He clarified that these layoffs are connected to the recent Activision Blizzard acquisition, emphasizing that “no games, devices or experiences are being cancelled” and no studios are being shut down as part of this latest round of cuts.

In his memo, Spencer explained, “As part of aligning our post-acquisition team structure and managing our business, we have made the decision to eliminate approximately 650 roles across Microsoft Gaming — mostly corporate and supporting functions — to organize our business for long-term success.”

The backdrop to these layoffs is Microsoft’s $68.7 billion acquisition of Activision Blizzard, which wrapped up in October after a lengthy and contentious review process with regulators in both the UK and the US.

Below is the full text of Phil Spencer’s memo:

For the past year, our goal has been to minimize disruption while welcoming new teams and enabling them to do their best work. As part of aligning our post-acquisition team structure and managing our business, we have made the decision to eliminate approximately 650 roles across Microsoft Gaming — mostly corporate and supporting functions — to organize our business for long term success.

I know that this is difficult news to hear. We are deeply grateful for the contributions of our colleagues who are learning they are impacted. In the US, we’re supporting them with exit packages that include severance, extended healthcare, and outplacement services to help with their transition; outside the US packages will differ according to location. 

With these changes, our corporate and supporting teams and resources are aligned for sustainable future growth, and can better support our studio teams and business units with programs and resources that can scale to meet their needs. Separately, as part of running the business, there are some impacts to other teams as they adapt to shifting priorities and manage the lifecycle and performance of games. No games, devices or experiences are being cancelled and no studios are being closed as part of these adjustments today.

Throughout our team’s history, we have had great moments, and we have had challenging ones. Today is one of the challenging days. I know that going through more changes like this is hard, but even in the most trying times, this team has been able to come together and show one another care and kindness as we work to continue delivering for our players. We appreciate your support as we navigate these changes and we thank you for your compassion and respect for each other.

Phil