Microsoft Cuts 3,200 Xbox Jobs as Game Pass Falls Far Short of 77M Target

According to the Wall Street Journal and Xbox CEO Asha Sharma's memo on Monday, Microsoft is cutting 3,200 jobs from its Xbox division—about 1,600 this week and 1,250 during the remainder of the fiscal year starting this month. The cuts represent roughly one-fifth of the division's workforce. Game Pass, Microsoft's gaming subscription service, currently has 30 million subscribers but was projected to reach 77 million this year, according to documents revealed in Activision acquisition proceedings.

Microsoft shares gained 0.6% in overnight trading ahead of Tuesday's market open. Year-to-date, MSFT stock has fallen 20%, underperforming the S&P 500's 10% gain. Retail sentiment for MSFT on StockTwits shifted to 'neutral' from 'bullish' over the extended weekend as traders express frustration over the stock's underperformance.