Microsoft to cut 1,900 jobs after Activision takeover

MICROSOFT is to cut 1,900 jobs following its $69bn (£54bn) takeover of Call of Duty games studio Activision Blizzard.

The losses will hit 8pc of the staff in Microsoft’s gaming division, which employs 22,000 people, although they will account for less than 1pc of the tech giant’s overall workforce.

The US technology company, which this week hit a valuation of more than $3 trillion, last year cut more than 10,000 jobs amid widespread redundancies across the industry.

Activision develops Call of Duty, one of the most lucrative franchises ever, as well as online fantasy game World of Warcraft and mobile app Candy Crush.

The cuts will largely affect Activision staff, The Verge reported, but will also hit employees at Microsoft’s Xbox console division and Zenimax, which develops the Fallout video game series. Xbox-maker Microsoft agreed to buy Activision two years ago, triggering months of regulatory investigations over concerns the tech giant could use the deal to harm Japan’s Sony, which makes the Playstation games console.

Sony had argued that Microsoft could use the deal to curb its access to the Call of Duty franchise. The deal eventually got the green light from regulators.

The takeover closed last October, after being initially announced in January 2022, representing the single biggest acquisition in Microsoft’s history.

Google is laying off around 1,000 staff, as is online auction site ebay. Riot Games, Amazon-owned Twitch and software maker Unity have all announced hundreds of job cuts.

Phil Spencer, the head of Microsoft’s gaming division, said in an email to staff the cuts were aimed at creating a “sustainable cost structure that will support the whole of our growing business”.

Separately, the US Federal Trade Commission (FTC) last night opened an investigation into the deals between tech companies and artificial intelligence businesses, saying it was concerned they could limit competition.

The FTC has demanded information from Microsoft and Chatgpt-maker Openai over their tie-up, as well as from Amazon and Google about investments they have made in rival company Anthropic.