Microsoft Looks to Make a Major Reset as It Says This Area of Its Business "Is Not Healthy"
Yahoo Finance ·
Microsoft ( MSFT +0.54% ) has a massive business with many products and services. And while its overall operations continue to grow and do well, some areas of its business are lagging. One area that frequently posts underwhelming results is gaming, with the company's Xbox segment typically struggling to show much growth. Microsoft hasn't turned a blind eye to that, and recently made a major announcement as it looks to shake up that area of its business. On Monday, Microsoft announced it would be eliminating 4,800 positions, representing just over 2% of its workforce. The bulk of those cuts pertain to its Xbox business, with 3,200 job losses in that area. Xbox CEO Asha Sharma was blunt, saying that "our business today is not healthy," pointing out the poor return on its investments in game studios, noting that "in a typical year, we lost 64 cents for every dollar we invested." Those kinds of losses are alarming, particularly for a company such as Microsoft, which seemingly has no problem turning a profit. Over the trailing 12 months, the tech company has generated $125 billion in profit on $318 billion in revenue.
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