Earlier this week, Microsoft, for the second straight year, announced a series of layoffs, with more than 1,900 employees, primarily part of Activision Blizzard, having been let go.
While Activision Blizzard, Bethesda Game Studios, and Xbox were all affected by the layoffs, Activision Blizzard was hurt the most, with every Call of Duty team, from the big names such as Treyarch, Infinity Ward, Sledgehammer Games, and Raven Software to support studios like High Moon Studio, Beenox, and Toys for Bob, losing a chunk of their workforce. Sledgehammer Games and Toys for Bob, especially, were hit the hardest, losing 30% of their staff members, as noted by CharlieIntel.
As part of these layoffs, Blizzard Entertainment lost the services of its co-founder, Allen Adham, and its president, Mike Ybarra, who stepped down from their former roles.
The move has drawn the ire of much of the gaming community, with most criticizing Microsoft for laying off thousands of employees just as it celebrates becoming just the second company ever to be valued at $3 trillion.
Microsoft gutting nearly a third of Sledgehammer Games and Toys for Bob immediately leads to a series of questions, in particular, about the future of Call of Duty. Sledgehammer is responsible for some of the worst-selling entries in the franchise in recent years. Did this factor into the decision? What about the ongoing support for Call of Duty: Modern Warfare 3 and Warzone? Losing so many individuals at the same time surely can’t help with the gargantuan task of supporting multiple live-service shooters at the same time.
This entire fiasco comes particularly surprising considering the state of Call of Duty in recent years. Two years ago, the franchise had set a new record for the second-fastest-selling video game of all time at launch. Then, just last year, the latest entry was a commercial success despite the criticism. It might not have had enough magic to topple Hogwarts Legacy’s massive sales numbers, but the point remains: why is Microsoft shaking things up, especially if it affects Call of Duty?
It’s hard to feel confident about Microsoft knowing what to do next. The tech giant, while one of the most successful in its field, hasn’t done too well in the live service genre. Redfall is a bust and Halo Infinite, originally planned to satisfy an entire generation of Xbox gamers, feels like it’s on life support. Sea of Thieves is successful, but only because of a lack of competition.
The most likely way forward is that Microsoft believes that it can put Call of Duty on the same path forward with less. But is that possible? Sony learned in recent years that the live service industry is no joke. To date, it has canceled several of its upcoming live service projects, most prominently, The Last of Us Online. Its once-robust plans to release several live service games through 2026 have been cut down to size, perhaps humbled by the harrowing reality.
Activision Blizzard is still relatively the same behemoth despite the dismissals. However, now that the company has to report to Matt Booty, who knows what will happen next?
There’s no question that Microsoft will continue to invest in Call of Duty in a meaningful capacity. Unlike Halo, which it appears to have given up on, Call of Duty is worth billions annually. It’s the quintessential cash cow. Abandoning Call of Duty’s annual release cycle at this point is foolish. But in terms of Call of Duty’s future, it’s all up in the air. Microsoft will try to put their stamp on the franchise, for better or for worse.
Given the layoffs the Call of Duty teams just suffered, Microsoft has sent a clear message. Perhaps the bigger question now is, will Xbox start making Call of Duty the face of the brand? Diablo, Call of Duty, Overwatch, Starfield, The Elder Scrolls, Fallout, and Starfield, are all bigger than any other franchise that Microsoft has produced.
It’s only been a few months since Call of Duty: Modern Warfare 3 came and days since the layoffs. This may not be the last we’ll hear of Microsoft’s restructuring of its now-suddenly-robust group of first-party studios. Many employees of the affected companies who retained their positions and much of the gaming industry would love the bleeding to stop right here. But what if it doesn’t?
Change is inevitable, even if it’s Call of Duty. For the first time in a long while, Microsoft has gamers wondering what Call of Duty will look like in the next few years.
