Microsoft to Cut 3,200 Xbox Jobs Over Fiscal 2027

com reported. The first 1,600 roles end today, July 6, 2026, touching every studio and every category of position. Sharma stated that Xbox operates at margins 3 to 10 times lower than comparable platform and publishing businesses and loses 64 cents for every dollar invested in a typical year.

Platform teams have grown 40 percent since the start of the current console generation, with some work flowing through as many as 14 layers of management. Management layers will be cut to no more than five and, where possible, three, while vendor spending will be reduced by 50 percent.

Helen Chiang has been promoted to chief operating officer with profit-and-loss responsibility for content, hardware, platform, and services and will report directly to Sharma.

Dave McCarthy is retiring after 17 years at Xbox. Compulsion Games and Double Fine Productions will become independent studios and keep their intellectual property. Ninja Theory and Undead Labs have agreed to new ownership that includes funding to finish Senua and State of Decay 3.

Arkane’s management in France has begun required consultation with its Works Council on strategic options. Mojang and King will now report directly to Sharma. No first-party publicly announced games or projects are being cancelled.

Xbox will invest the same amount in fiscal 2027 as in prior years and aims to return to growth in 2027, Sharma said.