Microsoft’s Xbox is taking strategic measures by closing down various gaming studios, including the likes of Arkane Austin, as part of its response to the current gaming landscape. This move comes in the wake of a widespread gaming slowdown trend observed within the industry.

In addition to Arkane Austin, studios like Tango Gameworks and Alpha Dog will also cease operations, leading to employee layoffs, according to a memo from Matt Booty, head of Xbox Game Studios, as reported by Reuters.

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Xbox has not disclosed the exact number of employees affected by the studio closures and resulting layoffs, refraining from commenting on the matter.

Enabling the ‘reprioritization of titles and resources’ allows Xbox to focus on enriching its game lineup and exploring new intellectual property ventures, a move crucial for sustaining growth, as per Booty’s vision.

All the impacted studios are part of ZeniMax Media, which Microsoft acquired for $7.5 billion in 2021, including Bethesda.

Microsoft’s Xbox content and services division witnessed a significant 62% revenue surge in the third quarter, primarily attributed to the successful Activision Blizzard acquisition.

Following suit, Take-Two Interactive, the developer behind “Grand Theft Auto,” announced shutdowns of two subsidiary studios as part of a major layoff plan, as reported by Bloomberg News.

Earlier in the year, Microsoft initiated layoffs affecting 1,900 employees across its Activision and Xbox teams.

Certain developers from Arkane Austin will transition to other studios within the company, contributing to various projects under the Bethesda umbrella, known for iconic titles like “The Elder Scrolls” and “Fallout.”

Notably, the game servers for “Redfall,” a creation of Arkane, will remain operational, ensuring continued gameplay opportunities for players.