King escapes Xbox cuts – for now

King will not be making major job cuts in the first round of Xbox layoffs, we’re told.

Four King sources claimed that there has not been any communication of impending layoffs internally, and there is a sense of surprise among some in the workforce that the Candy Crush maker has seemingly escaped a major restructure.

One person close to King said: “It’s a very profitable part of the business…the eye of Sauron won’t be looking at them just yet. I guess they have 12-24 months to show some new games or improvements to the bottom line before any cuts.”

We contacted both Xbox and King PR representatives for confirmation of these claims, but they have not responded.

Xbox announced last week that it would be cutting 3,200 jobs across its troubled Xbox division, with 1,600 of those confirmed last week and another 1,600 to come across the next financial year.

And while there is some nervousness at King over whether it will be next to see job losses, it is perhaps more protected from cuts than many parts of Xbox’s platform and console game departments, which have to date seen the most aggressive cuts.

As our sources noted, the success and profitability of the Candy Crush games plus portfolio titles like Farm Heroes Saga make King one of the standout performers in Microsoft’s vast gaming division.

That was reflected in King and Mojang’s effective ‘promotion’ in the Microsoft hierarchy last week. Both studios will now report directly into Xbox boss Asha Sharma. “These two studios have increasingly become platforms and are our largest by monthly active players,” Sharma said in a blog announcing the news. “They bring critical geographic, demographic, and differentiation to Xbox.”

Four console game studios are in the process of being spun out: Compulsion, Double Fine, Ninja Theory and Undead Labs. Arkane Lyon is also in consultation to do the same, while reports across the press over the last week have noted cuts at Doom maker Id Software, ZeniMax Online Studios, Bethesda Game Studios and more.

Last summer, King made around 200 job cuts, around 10% of its staff. Our sources claimed around half of those were in the Stockholm office, with 30 layoffs at King Barcelona and the rest from London, Berlin and its full-time remote workers.

Some sources claimed that some of those staff cut were effectively being  replaced by the AI tools they helped create and train.

“Most of level design has been wiped, which is crazy since they’ve spent months building tools to craft levels quicker,” one staffer told us last summer. “Now those AI tools are basically replacing the teams. Similarly the copywriting team is completely removing people since we now have AI tools that those individuals have been creating.”

They added: “The fact AI tools are replacing people is absolutely disgusting but it’s all about efficiency and profits even though the company is doing great overall. If we’re introducing more feedback loops then it’s crazy to remove the developers themselves, we need more hands and less leadership.”

We later reported on alleged layoff lawsuits, toxic management and low morale at the Candy Crush maker, though one insider claimed that many King staff were ‘pampered’ and overly-sensitive. In March, King refuted the claim that AI had replaced some jobs.