Synopsis
Microsoft is exploring significant changes for its Xbox gaming division. Options include a potential spinoff or restructuring as a wholly owned subsidiary. The company is also considering joint ventures. These moves aim to make the gaming business more attractive for potential sale. New leadership plans increased spending on top game franchises. Major layoffs and budget cuts are also anticipated.Listen to this article in summarized format
The Windows maker is also weighing options such as creating a joint venture with other partners as it prepares to overhaul the unit, which could make the gaming business easier to sell, the report said.
Xbox has struggled in recent years as Microsoft's bet on subscriptions and cloud gaming failed to offset declining console sales and a shortage of blockbuster titles.
While no restructuring is imminent, all the options remain on the table, the Information reported.
Microsoft operates professional network LinkedIn and software development platform GitHub as wholly owned subsidiaries, a model that could serve as a blueprint for the Xbox unit.
Asha Sharma, who took charge as CEO of the gaming unit in February, plans to increase spending to accelerate development of new Xbox titles from its most successful franchises, including "Halo," "Fallout," and "The Elder Scrolls," the report said.
Microsoft CEO Satya Nadella and finance chief Amy Hood have approved Sharma's plan to boost spending on top-tier game development for the fiscal year starting in July, but the budget has not been finalized and could still change, the report said.
Microsoft did not immediately respond to a Reuters request for comment.
On Wednesday, Bloomberg News reported that Xbox is planning major layoffs next month and significant cuts to marketing and other budgets, marking the first major restructuring under Sharma.
