Phil Spencer retirement rumor is made up, says Microsoft

Phil Spencer, chief executive officer of gaming at Microsoft Corp., arrives to court in San Francisco, California, US, on Wednesday, June 28, 2023. Microsoft and Activision Blizzard CEOs are expected to testify to persuade a federal judge in California to reject the Federal Trade Commission's effort to block their $69 billion deal. Photographer: Philip Pacheco/Bloomberg via Getty Images — (Image credit: Getty Images)

Microsoft Gaming CEO Phil Spencer has probably not penned his last email thanking employees for their hard work while pointing them to the door.

After Microsoft laid off around 9,000 employees today, including a number from Spencer's gaming division, a rumor began circulating that the Xbox head will step down after the next generation Xbox console comes out, but Microsoft says it's not true.

An exchange on X. Tom Henderson: I think I summed it up in the article just fine =) Frank X. Shaw: so long as by "summed it up" you mean "made it up." — (Image credit: Tom Henderson/Frank X. Shaw on X)

So far, we've learned that today's cuts include the cancellation of an MMO that was in development at Elder Scrolls Online studio ZeniMax Online (ESO director Matt Firor has also left), the cancellation of Rare game Everwild, the cancellation of the Perfect Dark reboot, and the closure of the studio behind that reboot, The Initiative. Around 9,000 people are losing their jobs across Microsoft, including departments outside of gaming.

Spencer justified today's gaming division layoffs by saying that Microsoft's success—it reported a net income of $25.8 billion for its most recent quarter—is the result of previous "tough decisions" like this one.

From the outside, it doesn't seem like the decision to cut jobs and close studios has been especially tough for Microsoft leadership. It cut 6,000 jobs just this past May. It also laid off thousands last year, closed Arkane Austin, Tango Gameworks (since revived by Krafton), and other studios, and cancelled a Blizzard survival game that had been in development for years. In 2023, it laid off 10,000 in one go.

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Tyler grew up in Silicon Valley during the '80s and '90s, playing games like Zork and Arkanoid on early PCs. He was later captivated by Myst, SimCity, Civilization, Command & Conquer, all the shooters they call "boomer shooters" now, and PS1 classic Bushido Blade (that's right: he had Bleem!). Tyler joined PC Gamer in 2011, and today he's focused on the site's news coverage. His hobbies include amateur boxing and adding to his 1,200-plus hours in Rocket League.

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