Microsoft cuts 4,800 jobs; Double Fine sits amid the wider tech layoffs reshaping Seattle’s game scene. Known for inventive titles like Grim Fandango Remastered and Psychonauts, the studio continues to push quirky, story-driven games while the industry recalibrates.
Microsoft has announced 4,800 job cuts companywide, including 3,200 roles in Xbox during fiscal 2027 and 1,600 Xbox positions eliminated immediately. Xbox will spin out or divest five studios and reduce management layers as it restructures to strengthen margins while shifting resources toward AI and core franchises. The move has reduced Xbox headcount by about 20%.