A new rumor about Microsoft puts clarity on the situation at Xbox.
Business Insider claims that Microsoft is planning another round of layoffs this month. Notably, they have had layoffs every July 1 for the past two years. This date is the start of the company’s fiscal year.
These layoffs will occur across the company, including Xbox. Business Insider says they will layoff 2.5 % of the company. At 220,000 headcount, that amounts to 5,500 employees. It will be lower than the reported 9,000 employees Microsoft laid off this time last year.
There could be another thing different this time around. Last July 2025, Microsoft’s gaming division did not talk to the public about the layoffs. Instead, Phil Spencer’s email leaked, and they never went on the record on which studios and game divisions had layoffs.
Last month, XBOX’s current CEO Asha Sharma promised they would be upfront with the public. She released her company newsletter Next 100 Days: XBOX Reset to the public.
Asha can demonstrate integrity by telling us directly about XBOX’s layoffs. It’s the least XBOX can do to respect their workers, something that’s been sorely missing in the industry.