Xbox Boss Phil Spencer On Microsoft Studio Closures: 'I Have To Run A Sustainable Business'

Xbox boss Phil Spencer addressed the closures of several Microsoft Corp.’s MSFT gaming studios, including Redfall developer Arkane Austin and Hi-Fi Rush developer Tango Gameworks.

In a recent interview with IGN’s Ryan McCaffrey at IGN Live, Spencer stated he had to make “hard decisions” to ensure a sustainable business.

See Also: Xbox Exec Sarah Bond Addresses Microsoft’s Studio Closures: ‘It’s Always Extraordinarily Hard To Make Decisions Like That’

“The closure of any team is hard obviously on the individuals there, hard on the team,” Spencer said. “I haven’t been talking publicly about this, because right now is the time for us to focus on the team and the individuals. It’s obviously a decision that’s very hard on them, and I want to make sure through severance and other things that we’re doing the right thing for the individuals on the team. It’s not about my PR, it’s not about Xbox PR. It’s about those teams.”

The closures, part of broader layoffs affecting around 1,900 staff, were surprising and upsetting within the industry. This is especially notable given Tango Gameworks’ recent success with Hi-Fi Rush, a popular Xbox exclusive.

Spencer reiterated the necessity of these decisions, despite personal and professional reluctance. “Sometimes I have to make hard decisions that frankly are not decisions I love, but decisions that somebody needs to go make,” he explained.

Despite the layoffs, Spencer assured that Xbox will continue to invest in and build its business. He mentioned the importance of maintaining a sustainable business model to support future projects and initiatives.

“We will continue to go forward. We will continue to invest in what we’re trying to do in Xbox and build the best business we can,” he stated.

The closures also include Alpha Dog Games, while Roundhouse Studios will be integrated into ZeniMax Online Studios. This marks the first time Spencer publicly commented on these closures since the announcements.

Xbox President Sarah Bond echoed Spencer’s sentiments at a Bloomberg conference, emphasizing the long-term health of the Xbox business during this transitional period.

The layoffs at Microsoft reflect a broader trend of workforce reductions in the gaming industry, with companies such as Sony Group Corp. SONY, Riot and Epic also implementing significant cuts.

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