Nadella Backs Xbox Layoffs, Sees Division Returning to Growth

Microsoft CEO Satya Nadella has expressed his support for the recent Xbox restructuring plan, which involves significant job cuts. In an interview on the Sources Podcast, Nadella called the streamlining efforts 'great to see', despite the fact that 268 new layoffs were announced this week, bringing the total number of job losses in the Xbox division to 1,868 since February. The goal is to reduce the headcount by 3,200 employees before the end of the fiscal year.

Nadella also mentioned that the Xbox division will return to growth in the next fiscal year, a claim that was previously made by his team. However, it's worth noting that this was actually Nadella's own mandate when he stated that after 25 years of investment, Xbox must become a sustainable business. The alternative being considered is a potential sale or joint venture.

Nadella sees gaming as an integral part of Microsoft's core DNA, alongside developer tools and knowledge work. He expressed confidence in the company's IP portfolio and ability to produce great games going forward.