Xbox's Biggest Restructure Exposes the Problem It Tried Too Long to Ignore

Xbox has seen some huge changes this year, and the biggest shake-up of 2026 so far has arrived in the form of mass layoffs and shocking restructuring efforts. The past few years have been really rocky for Xbox, and the company's plans to cut 1,600 jobs immediately (and 3,200 in total within the next year) put a huge spotlight on just how dire of a state the company is in. Mass layoffs are devastating in any industry, and the company-wide memo sent out to employees and shared via Twitter even admitted that it's a consequence of Xbox betting too much on Game Pass, expanding to other platforms, and growing its gaming portfolio to the point of being bloated.