By Aditya Soni
(Reuters) -Microsoft will let go of 1,900 employees at Activision Blizzard (NASDAQ:ATVI) and Xbox this week, it said on Thursday, the latest cuts in the technology sector that has extended massive layoffs over the past years into 2024.
The cuts represent about 8% of the overall Microsoft (NASDAQ:MSFT) Gaming division and will mostly happen at Activision Blizzard.
Blizzard President Mike Ybarra and Chief Design Officer Allen Adham are also leaving the company, while a previously announced survival game by Blizzard has been canceled, Microsoft said.
The news comes months after Microsoft closed its $69 billion deal for Activision Blizzard, boosting its heft in the videogaming market with best-selling titles, including "Call of Duty", to better compete with industry leader Sony (NYSE:SONY).
"Microsoft's announcement that it will be laying off 1,900 video game workers makes clear that, even when you work at a successful company in an extremely profitable industry, your livelihood is not protected without a voice on the job," Communications Workers of America (CWA) said.
"We will continue to support workers at Microsoft and across the video game industry who want to have a union voice on the job," it added.
Several other big firms such as Alphabet (NASDAQ:GOOGL), Amazon.com (NASDAQ:AMZN) and ebay have also laid off thousands of staff in recent weeks to lower costs and boost profitability.
Overall, more than 21,000 workers have been let go of in 76 tech companies in January, according to tracking website Layoffs.fyi.
The tech sector shed 168,032 jobs in 2023 and accounted for the highest number of layoffs across industries, according to a report by Challenger, Gray and Christmas earlier this month. That included more than 10,000 cuts at Microsoft.
Analysts and industry experts have said they expect fewer layoffs this year, with firms that are racing to catch up in the AI space more likely to downsize to offset the billions of dollars they are spending on the technology.
The Verge was the first to report the news on the latest job cuts by Microsoft.