Xbox has confirmed that 3,200 employees will be made redundant as part of its big 'reset', with a total of four studios let go from the business (thanks, Pure Xbox). 1,600 employees will be let go today, with another 1,600 within the next 12 months.

Fortunately, none of the development studios will face total closure. Double Fine (Psychonauts 2, Keeper) and Compulsion Games (South of Midnight, We Happy Few) will regain their independence and retain their IP, with Xbox providing "runway for their next games".

Ninja Theory (Hellblade: Senua's Sacrifice, DmC) and Undead Labs (State of Decay), meanwhile, have entered terms to join new ownership, with funding to complete development on Senua and State of Decay 3 respectively.

Finally, Arkane (Dishonored, Marvel's Blade) is also entering talks to "review potential strategic options".

Though the survival of these studios is welcome news, it is nevertheless devastating to read of such sweeping layoffs at Xbox. CEO Asha Sharma confirms that redundancies have affected multiple areas of the business, including Activision, Bethesda/ZeniMax, Blizzard, King, Mojang, and Xbox Game Studios. She clarifies that none of the first-party publicly-announced games are being cancelled.

Sharma also confirmed that Mojang (Minecraft) and King (Candy Crush Saga) will now report directly to her, seemingly implying that neither have capitalised on their popularity as much as they perhaps should have.

There's a lot more to parse in Sharma's letter, so do have a read through when you have a moment. For now, we'll leave you with the last few paragraphs, which, given the challenges surrounding hardware prices at the moment, read a little overly-optimistic, in our opinion:

"These changes are about a bigger future for XBOX, not a smaller one. The next decade of gaming will be larger, more global, and more creative than anything we’ve seen before. This year, we’ll invest as much in XBOX as we ever have, but we’ll invest with greater focus, greater discipline, and greater clarity, all in service of making XBOX where the world plays and creates.

"I want XBOX to be one of the few companies that entertains more than a billion people each day and gives everyone the opportunity to create and connect. I know we can achieve this goal. XBOX has many of the most beloved franchises in entertainment history, talented studios around the world, and we will return to growth in 2027.

"History is full of companies that mistake longevity for inevitability. We will not be one of them."

What do you make of Xbox's big reset? Share a comment in the usual place and let us know.

[source news.xbox.com, via purexbox.com]