More job cuts coming to Xbox shortly after Arkane Austin and Tango Gameworks closures

The job cuts aren't over for Xbox, and new reports say that Microsoft is poised to make even more layoffs.

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There's turmoil at Xbox, and the global games industry, as costs continue to rise exponentially. Companies are shrinking budgets and reducing spending in an effort to stabilize budgets and create some semblance of growth--or, at the very least, reduced losses. Xbox took a hit with its Q2 results, with hardware revenues dropping to the lowest point of the Xbox Series generation. Overall revenues are flat without Activision's contribution.

Market trends and economic conditions have triggered mass layoffs at Xbox, with Activision Blizzard King shedding 1,900 workers. Then this month, Xbox made one of the most controversial decisions in recent memory by closing three Bethesda Softworks studios: Arkane Austin, Tango Gameworks, and Alpha Dog. This isn't the end, though.

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Read Also:Why Xbox closed Tango Gameworks and Arkane Austin

Sources have told Bloomberg's Jason Schreier that more layoffs and budget slashes are expected. Microsoft's gaming employees across all divisions--Xbox Game Studios, Activision Blizzard King, and ZeniMax--are all bracing to see who will be impacted next.

Schreier reports that ZeniMax has started to offer employees voluntary severance plans to certain roles, including those in producer and quality assurance jobs.

It's unknown which divisions will be targeted by the next wave of layoffs and cuts.

In an internal memo, Xbox president of content and studios Matt Booty said that the closures were a result of a new "reprioritization of titles and resources" that feds more money into Bethesda's bigger games.

It's possible that this is also the same reason that Xbox cancelled Blizzard's new IP - allocating that game's budget to projects within existing franchises that already make money.