Microsoft’s (MSFT) Xbox division is preparing for major layoffs next month, Bloomberg reported. The cuts are expected shortly after Microsoft’s fiscal year ends on June 30. While the exact number of job cuts is still unclear, Xbox is also planning deep budget reductions, including in marketing and other parts of the business.Introducing TipRanks MCP for Agents Deliver institutional-grade market data directly into Claude, ChatGPT, Cursor, and other MCP-compatible AI tools. Designed for personal research, portfolio monitoring, and AI-assisted investment workflows.
This marks a big shake‑up under new Xbox CEO Asha Sharma, who stepped into the role in February. At the Bloomberg Tech conference, she said Xbox was “not in a healthy spot” and made clear she intends to “reset the business.”
Business Under Pressure
In an internal email seen by Bloomberg, Sharma told employees that Xbox’s accountability margin, Microsoft’s internal profit metric, had fallen to just 3%.
She said that, excluding Activision Blizzard King, Xbox has spent more than $20 billion over the past five years on content, platform work, and hardware subsidies. Yet annual revenue has dropped by nearly $500 million over that same period.
