Xbox reportedly planning three more rounds of layoffs, with the first wave coming as early as this month

Xbox is preparing for three additional rounds of layoffs throughout the remainder of 2026 and into 2027, according to multiple reports. The first wave is scheduled for October, with subsequent cuts planned for November and January 2027. This continues the ongoing restructuring led by new CEO Asha Sharma.

Since announcing a workforce reduction plan in July, Xbox has already eliminated 1,868 positions, including a September round that removed 268 roles alongside organizational changes. The company is targeting a total reduction of 3,200 jobs over the year, representing a significant portion of its workforce. The layoffs have disproportionately affected company veterans, raising concerns about the loss of institutional knowledge within the organization.

Microsoft leadership has reaffirmed its commitment to Xbox despite ongoing speculation. Jason Althoff, CEO of Microsoft’s commercial business, stated that Asha Sharma is “one of the best leaders we have at the whole company” and noted that Microsoft would not have placed her in charge of a business intended for sale, directly addressing rumors about Xbox being spun off.

Beyond workforce restructuring, Xbox is reportedly working on a major Game Pass overhaul designed to offer subscribers greater flexibility in choosing which service components to pay for. Additionally, the next Xbox console generation is rumored to come with a premium price tag.

While plans could change, the reported schedule suggests Xbox will undergo significant transformation through early 2027 as Sharma implements her vision for the division’s future.

Xbox reportedly planning three more rounds of layoffs, with the first wave coming as early as this month

Sources