Microsoft’s Xbox division is facing a wave of criticism, both internally and externally, as its ambitious plans and shifting strategies leave many questioning its direction. The recent acquisition of Activision Blizzard King has heightened pressure on Xbox to deliver, leading to a series of changes that have surprised fans and developers alike. From broken exclusivity deals to a seemingly inconsistent roadmap, Xbox’s future appears clouded in uncertainty.
Microsoft’s $70 billion acquisition of Activision Blizzard King in 2023 has brought significant pressure on Xbox to deliver strong earnings performance. While Xbox revenues reached a record-breaking $21.52 billion in FY24, internal profit targets remain shrouded in mystery. Sources suggest that achieving these targets may be challenging, and analysts are eager to see how Xbox’s performance translates into concrete profitability for Microsoft.
Microsoft’s recent round of layoffs within its gaming division has impacted key teams at Activision Blizzard, including those behind Call of Duty: Warzone Mobile and Warcraft Rumble. The cuts come after the company’s $69 billion acquisition of the gaming giant and highlight challenges in the mobile gaming market, particularly for Warzone Mobile, which has not met expectations despite its innovative features. Warcraft Rumble, while initially successful, has also faced waning interest, leading to further layoffs. Despite these setbacks, Microsoft’s overall gaming business remains strong, with surging content sales and a robust pipeline of upcoming releases.
Microsoft has laid off 650 employees in its gaming division, following its $68.7 billion acquisition of Activision Blizzard. These cuts are part of a larger restructuring effort to integrate Activision Blizzard’s teams and streamline operations. The layoffs impact approximately 8% of Microsoft’s gaming workforce.
Raven Software, a Call of Duty developer and the first Activision Blizzard studio to unionize, has filed a complaint with the National Labor Relations Board against Microsoft, alleging unfair labor practices. The union claims Microsoft has refused to bargain in good faith and retaliated against workers’ efforts to secure their labor rights.
Microsoft’s gaming division, Xbox, achieved record-breaking revenue in FY24, largely driven by the recent acquisition of Activision Blizzard King. The acquisition contributed significantly to Xbox’s overall growth, but the analysis reveals a more nuanced picture of the Xbox business without Activision.
Microsoft’s gaming division, Xbox, has reported record-breaking revenue for Fiscal Year 2024, driven primarily by the acquisition of Activision Blizzard King. The merger has significantly boosted Xbox’s earnings, with Activision Blizzard King’s contributions reaching over $1 billion in three consecutive quarters.
Microsoft’s acquisition of Activision Blizzard continues to unfold, with Crash Bandicoot N. Sane Trilogy now available on Xbox Game Pass. While the integration is slow, the addition of Crash Bandicoot and other recent titles like Diablo 4 and Call of Duty: Modern Warfare 3 signals a gradual influx of Activision Blizzard games onto the subscription service.
Microsoft is expanding its gaming reach into the mobile market with a new browser-based store and a focus on mid-sized games within existing franchises. This move, fueled by the Activision Blizzard acquisition, aims to diversify its game offerings and counter the rising costs of AAA development.
In a significant move amid industry-wide layoffs and economic uncertainty, Blizzard’s World of Warcraft team has successfully unionized, forming the World of Warcraft Game Makers Guild – CWA Union (WoWGG-CWA). This marks the first wall-to-wall union at Activision Blizzard and the largest at a Microsoft-owned studio. The unionization effort comes after Microsoft’s acquisition of Activision-Blizzard and subsequent layoffs, highlighting the growing concerns of game developers over job security and working conditions.
