'Our business is not healthy': Xbox chief as Microsoft cuts 4,800 jobs

Redmond: Microsoft is cutting around 4,800 jobs, or approximately 2.1 per cent of its global workforce, with its Xbox gaming business bearing a significant share of the layoffs as the company restructures the division amid mounting industry challenges.

The latest round of job cuts includes around 1,600 positions within Xbox, with further reductions expected later this year as part of a wider reorganisation aimed at repositioning the gaming business.

In a memo to employees on Monday, Xbox CEO Asha Sharma, who assumed leadership of the gaming division earlier this year, said the restructuring was necessary to "reset" the business in response to growing competitive and financial pressures.

"Our business today is not healthy," Sharma wrote. "We are operating at margins that are 3–10 times lower than comparable platform and publishing businesses."

She added that the gaming industry is grappling with a severe "hardware crisis", with rising costs for console components placing additional pressure on manufacturers.

Microsoft's Xbox division competes with Sony's PlayStation and Nintendo's Switch in the global console gaming market. The latest restructuring comes as gaming companies across the industry face slowing hardware sales, rising development costs and shifting consumer spending.

The job cuts form part of Microsoft's broader efforts to streamline operations and improve profitability across its businesses.