Microsoft CEO Satya Nadella has spoken about the state of Xbox following layoffs that affected thousands of workers, saying that the “streamlining” at the company is “great to see.”
The tech executive opened up about how the business’ gaming branch is doing during a recent interview on the Sources Podcast with Alex Heath. It’s a conversation that followed not only the 1,600 job cuts Xbox delivered in July of this year but also the additional structural changes that were announced just this past week.
When touching on Xbox’s place under the grander Microsoft umbrella, Nadella said he feels “fantastic” about the IP the brand has in its portfolio and its “ability to take that and produce great games going forward.” As layoffs continue to reshape the developers who have made some of those great games, he still seems to be feeling pretty good.
“There’s a certain amount of streamlining the team is doing and [Xbox CEO Asha Sharma] is doing, which is great to see,” Nadella said in the wake of the most recent cuts. “And then, we have to invent the right sustainable business model that allows us to deliver gaming to more and more people.
“That has always been the goal, which is, we want to be a great publisher and a great platform provider for games across both PCs and Xboxes. So, that is our goal, and I think Asha and team have said that Xbox is going to get back to growth this next fiscal year, and that’s the plan they’re executing on, and in that process, do a bang-up job of producing some great games.”
It’s optimism that may come as a shock to those who have watched as Microsoft continues to redefine what the Xbox name means by shedding game developers like Double Fine and Ninja Theory and reorganizing beloved studios like id Software. Maybe the most telling sign that the company is entering a new chapter arrived just this past week, when it announced that Halo would be moved from Halo Studios to its Activision teams.
Xbox announced in July that it could be laying off 1,600 staff, with an additional 1,600 set to follow before the end of the fiscal year. Although this past week offered a closer look at what that long-term plan entails, we won’t know the full scope of the company’s big “reset” initiative for at least a few more months.
For now, the resulting changes also include the Fallout: New Vegas team at Obsidian Entertainment moving under Bethesda. After State of Decay developer Undead Labs confirmed its independence just days ago, studio head Philip Holt told IGN that the zombie series’ third game remains in active development amid its own “significant” wave of layoffs.
For more on how the industry has changed in recent months, you can read about what Nadella had to say about how Xbox’s monetization plan at Microsoft compares to YouTube. You can also catch up on what he said about the brand when former Xbox CEO Phil Spencer departed the company.
Photo by George Chan/Getty Images.
Michael Cripe
Freelance Writer
Michael Cripe is a freelance writer with IGN. He’s best known for his work at sites like The Pitch, The Escapist, and OnlySP. Be sure to give him a follow on Bluesky (@mikecripe.bsky.social) and Twitter (@MikeCripe).
