Update: Microsoft has confirmed that – as part of a major staff reduction – it will shut down Xbox Entertainment Studios. Xbox boss Phil Spencer confirmed the news to Xbox Entertainment Studios staff on Thursday in an email:
"One such plan is that, in the coming months, we expect to close Xbox Entertainment Studios. I would like to take this opportunity to recognize the accomplishments from the entire team in XES. They have built an impressive slate of original programming and pioneered interactive entertainment on Xbox, such as the innovative reality series 'Every Street United' that succeeded in uniting audiences around the globe during the recent World Cup."
He goes on to say that work will continue on the Atari documentary "Signal to Noise" and the Halo-inspired series "Halo: Nightfall."
Original story: Earlier this week we reported that Microsoft would initiate a series of layoffs affecting its workforce that might impact its Xbox division – today we have a number, and it is massive. Microsoft CEO Satya Nadella announced this morning that the company will lay off 18,000 employees in the next year. Prior to the layoffs Microsoft employed 127,000 people globally. Around 12,500 of those employees being affected work for Nokia, which Microsoft acquired in April.
"Later today your Senior Leadership Team member will share more on what to expect in your organization," Nadella wrote in a letter to employees. "Our workforce reductions are mainly driven by two outcomes: work simplification as well as Nokia Devices and Services integration synergies and strategic alignment."
Nadella said that he will share more information about the layoffs on July 22 during the company's earnings call.
The first 13,000 employees will be laid off over the next six months.
Beyond its Nokia division, Microsoft does not say what divisions will be affected by the remainder of those layoffs.
This is the largest round of layoffs in the company's history.
We will have more on this story as it develops.