Microsoft announces 3200 layoffs and four studio departures in "most significant" Xbox restructuring in history

Microsoft is laying off 3,200 Xbox employees—1,600 immediately and 1,600 by June 2027—and spinning off four studios. Double Fine and Compulsion Games will transition to independence with their IP and game runway. Ninja Theory and Undead Labs are entering new ownership with funding to complete Senua and State of Decay 3. Arkane is in talks about its future. No publicly announced first-party games are being cancelled.

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