Microsoft’s gaming division is reportedly bracing for another shake-up that could once again ripple across multiple studios and teams. According to Nintendo Life, which cites an exclusive from The Information, a second wave of cuts is allegedly imminent — and it could be sizeable.
What Was Reported
Nintendo Life relays that, per The Information, Xbox is expected to undertake what’s being described as “wave two” of its ongoing reset. This next phase is said to potentially axe "hundreds of jobs", following a prior cull that the division itself confirmed as over 3,000 job cuts, which had eliminated approximately 1,600 positions at the time.
The same reporting suggests Xbox plans to consolidate several studios. The coverage does not detail exact mechanisms, but it points to possible mergers or organisational movement under major banners inside the division — specifically Xbox Game Studios, Bethesda, Activision and Blizzard.
Nintendo Life also reminds readers that the earlier round of layoffs “began this reset of the Xbox division in July” and had already impacted multiple development teams, including id Software (known for DOOM), while naming other studios like Double Fine (Psychonauts) and Compulsion Games (South of Midnight) as having regained independence in that shuffle.
The Source & Credibility
Take this with a pinch of salt: Nintendo Life is passing along an exclusive attributed to The Information. That outlet is named directly by Nintendo Life and is the origin of the claim that significant news about Xbox “is expected to drop this week.” Because Nintendo Life is not the primary reporter on the exclusive, the reporting chain here is a secondary relay of that exclusive.
We should be sceptical but watchful — the language in the reporting is careful. Phrases such as “potentially axing ‘hundreds of jobs’” and that the consolidation “does not specify how exactly this will play out” are caveats present in the source. In other words, these are allegations and plans, not confirmed final actions from Microsoft.
For context inside our coverage, this rumour arrives alongside other Xbox-focused stories we’ve run, including changes at Halo Studios and broader speculation around Xbox Game Pass. Those items, separately reported, paint a picture of ongoing internal restructuring conversations across the Xbox ecosystem — but each claim still needs independent confirmation from Microsoft.
What It Could Mean
If true, a second wave described as removing "hundreds of jobs" would deepen the overhaul that started with the earlier cuts. Consolidation under the division’s major banners — Xbox Game Studios, Bethesda, Activision and Blizzard — could involve mergers of teams, regrouping of projects, or shifting reporting lines, although the source does not spell out which of these is planned.
- Developers Named: The source specifically notes past impacts on teams such as id Software, and the independence returns for Double Fine and Compulsion Games, highlighting how uneven the effects of restructuring can be across studios.
- Platform Output: Nintendo Life highlights that, despite the internal changes, some Xbox-affiliated companies are still launching on Nintendo platforms — for example, Blizzard surprising Switch 2 owners with the launch of Diablo IV: Age of Hatred Collection and Mojang’s Minecraft Dungeons II reportedly arriving on Switch 1 & 2 later this month.
- Leadership Watch: The story specifically suggests observers are waiting for statements from Xbox’s new boss Asha Sharma or Microsoft itself — implying any confirmation or clarification is likely to come from those sources.
Why This Matters
Allegations of another large-scale round of cuts and studio consolidation matter for several reasons. They would affect real people in the industry, potentially reshape which teams work on which projects, and could alter the pace and nature of games coming from brands under the Xbox umbrella. If consolidation under names like Bethesda or Blizzard is part of the plan, that could reverberate across development pipelines and partner relationships.
Again, this is emerging and presented as an exclusive by The Information via Nintendo Life — so take it with a pinch of salt. If we hear any significant updates from Asha Sharma or Microsoft, we’ll report them. Until then, treat this as a developing situation: alarming for those involved, and potentially transformative for Xbox’s internal structure if it proves accurate.
