Microsoft lately introduced mass layoffs affecting 4,800 individuals, together with 3,200 at Xbox, and now US Senator Bernie Sanders (D-VT) has ripped the expertise large for slicing employees at a time when it is making large income.
Posting on social media, Sanders identified how Microsoft made greater than $100 billion in revenue in 2025, with CEO Satya Nadella getting paid $96 million. He additionally known as out how US President Donald Trump’s new tax plan would save Microsoft $12.5 billion.
“Please don’t inform me company tax breaks create jobs. It by no means trickles down,” he mentioned, calling out the Xbox layoffs and the Xbox console value hikes. The newest Xbox console value hike brings the Collection X as much as a whopping $800.
For the fiscal 12 months that Sanders is referring to, Microsoft made $101.8 billion in revenue (up 16%) on income of $281.7 billion (up 15%). Microsoft general could have accomplished nicely financially in the course of the 12 months, however Xbox was in a rougher spot, if commentary from Xbox CEO Asha Sharma is to be believed.
She has mentioned the Xbox enterprise is “not wholesome” and that a wide range of bets made by earlier leaders Phil Spencer and Sarah Bond didn’t repay. That is left Sharma able the place Xbox’s working margins are 3-10x decrease than what she mentioned have been “comparable platform and publishing companies.”
Sharma mentioned Xbox was working as a enterprise with 3% margins, which suggests for each $100 made, the corporate spends $97 and retains $3. A enterprise working at that margin stage could possibly be advantageous, however Microsoft’s different enterprise items have 40%+ revenue margins.
Microsoft’s inventory value is down 19% to this point this 12 months and greater than 22% over the previous 12 months. In actual fact, June 2026 was the worst month for Microsoft’s inventory value since December 2000.
A few of the bets that Xbox made that didn’t repay as Microsoft envisioned included Xbox Sport Move, releasing video games on rival programs, and shopping for up studios, Sharma mentioned. For Sport Move, a current report mentioned some Xbox staff fearful that the plan to launch new video games into the service was not really a sensible transfer, however administration proceeded anyway.
Along with mass layoffs, Xbox is divesting of 5 studios. Double High quality and Compulsion are regaining their independence, whereas Ninja Concept and Undead Labs are being bought. Arkane Lyon is within the “session” course of to find out its destiny and the destiny of the studio’s upcoming recreation, Marvel’s Blade.
Picture credit score: Bernie Sanders YouTube
