A Fresh Perspective on Microsoft’s Diversification: More about Corporate Communication than Layoffs
Microsoft, the tech giant, has recently made significant layoffs in its gaming division, but in their latest assembly discussing the relatively good financial results of the second fiscal quarter of 2024, the management avoided specific mention of these layoffs, using vague words to address the topic.
Following the layoffs of 1,900 employees due to the acquisition of Activision Blizzard, many of them received support from their colleagues and the community. Now, Microsoft, as the owner of Xbox, held a large meeting to discuss the results of the second quarter of the fiscal year 2024. While such meetings typically involve corporate language and numerical expressions, the way the layoffs were addressed, or rather the lack of mention, is noteworthy.
The meeting naturally covered the financial state of Xbox following the acquisition of Activision Blizzard. To shed some light on this aspect, it is worth mentioning that Xbox game revenues increased by 49%, exceeding $7 billion in the fourth quarter ended in December 2023.
Microsoft acknowledged that the net effect of the Activision Blizzard deal was a significant contributing factor to this growth. However, when it came to discussing the financial implications of the acquisition, Microsoft’s CFO, Amy Hood, used exceptionally derogatory language to describe the layoffs. She referred to the 1,900 job cuts as “last week’s” and unapologetically classified all the expenses related to these severance packages as “transaction-related costs” within the ActiBlizz agreement.
Hood also noted that “across the entire company, the headcount at the end of December 2023 was 2% lower than the previous year,” but it appears that these statistics exclude the layoffs from the previous week, as they occurred in the new year. Apart from that, the only other mention found was the need for “disciplined cost management across all teams” in the future.
It is important to note that I am not accusing Microsoft of hiding these 1,900 layoffs or entirely avoiding their discussion. However, it does seem somewhat insensitive to not even mention the word “layoffs” and fail to reflect some of the language used by Phil Spencer in his note from last week to emphasize that the company regrets taking such actions.
These comments from the shareholders’ meeting and the related numbers will be read by many of the recently laid-off Microsoft employees, many of whom contributed to Xbox’s current financial position through their hard work. One statement may be enough to consider the matter already discussed, but given the current state of disillusionment in the gaming industry, it would be wise to see conciliatory words enduring not just for a few days immediately after the layoffs. Especially when these companies celebrate continued profits that most of us would never witness, right after letting go of a significant number of employees in a seemingly unpromising job market.
Frequently Asked Questions (FAQ) section covering the main topics and information presented in the article:
1. What was Microsoft’s stance on the layoffs related to the Activision Blizzard acquisition?
Microsoft avoided specifically mentioning the layoffs during the board meeting, where they discussed the financial results of the second fiscal quarter of 2024.
2. How did Microsoft address the financial state of Xbox after acquiring Activision Blizzard?
Microsoft acknowledged that Xbox game revenues increased by 49% in the fourth quarter ending in December 2023, surpassing $7 billion.
3. How did Microsoft’s CFO, Amy Hood, address the employee layoffs?
Amy Hood used derogatory language, referring to the layoffs as “transaction-related costs” and providing limited details about them.
4. What was the employee count at Microsoft by the end of 2023 compared to the previous year?
The employee count at Microsoft by the end of December 2023 was 2% lower than the previous year, but it did not yet include the recent layoffs.
5. What did Phil Spencer mention in his note last week regarding the layoffs?
Phil Spencer expressed regret over the layoffs and emphasized that the company regrets taking such actions.
Defined terms and jargon used in the article:
– Layoffs: The process of reducing the number of employees in a company
– Acquisition: Taking control of another company by purchasing its shares or a majority stake
– Fiscal quarter: A three-month period in which a company prepares its financial reports
– Revenues: Income generated by a company from its operations
– Shareholders: Individuals or institutions owning shares in a company
– Transaction-related costs: Expenses incurred as a result of a transaction
Suggested related links:
– Microsoft’s official website
– Xbox’s official website
The source of the article is from the blog regiozottegem.be