Microsoft is preparing mass layoffs that could affect up to 5,500 employees, with roughly 1,000 positions potentially eliminated in the Xbox division.
The cuts form part of a broader reset led by Xbox CEO Asha Sharma. Several studios including Compulsion Games, Ninja Theory, Double Fine, Undead Labs and Arkane Studios are reportedly in discussions over their futures.
Microsoft stated it is not reducing overall investment in games and expects to spend about the same on content as last year. The company said only the types of projects it backs are changing.
Reports conflict on Obsidian Entertainment. The Game Business indicated the studio is negotiating to avoid closure, while Bloomberg's Jason Schreier confirmed it will not shut down. OD, the upcoming title from Hideo Kojima, is reportedly safe from the cuts.
The layoffs are scheduled to become clearer on Monday.
