Microsoft to Cut 9,000 Jobs, Hitting Xbox and Candy Crush Divisions

Microsoft is laying off about 9,000 workers—roughly 4% of its global workforce—as the tech giant kicks off its 2026 fiscal year with another round of job cuts. The layoffs continue at Microsoft.

The layoffs will hit teams across different regions and departments, including major impacts to its gaming units like Xbox and the Barcelona-based Candy Crush developer King, according to CNBC and Bloomberg.

“We continue to implement organizational changes necessary to best position the company and teams for success in a dynamic marketplace,” a Microsoft spokesperson told CNBC.

The job cuts are part of Microsoft’s ongoing effort to slim down management layers and boost efficiency. This follows earlier layoffs this year, including 6,000 jobs cut in May and 300 more in June. In January, fewer than 1% of roles were eliminated based on performance. Microsoft ended its 2024 fiscal year with about 228,000 employees.

Microsoft Gaming CEO Phil Spencer confirmed the cuts in a memo to Xbox employees, writing, saying, “To position Gaming for enduring success… we will end or decrease work in certain areas of the business and follow Microsoft’s lead in removing layers of management to increase agility and effectiveness.”

Bloomberg reports that about 200 jobs—10% of staff—will be cut at King, the Candy Crush studio, with layoffs also affecting other European offices such as ZeniMax.

One casualty of the layoffs? Xbox has reportedly canceled the Rare game Everwild, according to Bloomberg as well.