Insiders believe the consolidation could touch Xbox's publishing arms, though a final headcount and specific studio targets have not been named. Blizzard was reportedly spared during a previous wave of cuts in July, when CEO Asha Sharma eliminated 1,600 roles as part of a planned 3,200 reductions through fiscal 2027. The report does not confirm whether Microsoft's earlier promise not to cancel publicly announced first-party projects still applies to this round.

The layoffs are said to be imminent, with Bloomberg's Jason Schreier noting that despite being Xbox's most profitable branch, Blizzard is still facing cuts. This follows a period of high-profile announcements and strong community engagement, including the reveal of Diablo V and the beta for World of Warcraft: Forever. The timing is notable as post-launch periods often expose studios between projects to restructuring.