Microsoft Corp. MSFT has issued a direct response to the Federal Trade Commission (FTC) regarding layoffs subsequent to its acquisition of Activision.
The FTC had criticized Microsoft’s 1,900 layoffs, contending that they contradicted earlier assurances made during the antitrust trial.
In response, Microsoft asserted that Activision had already planned significant job cuts before the merger and dismissed the FTC’s claims as “incomplete and misleading,” as reported by The Verge.
Microsoft clarified that “Activision was already planning on eliminating a significant number of jobs while still operating as an independent company.”
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Microsoft’s filing also indicated that Activision’s pre-existing layoff plans were in line with industry trends affecting the gaming sector. This coincides with layoffs announced by other gaming companies such as Sega Sammy Holdings Inc SGAMY and CI Games, reflecting broader industry challenges.
Microsoft had previously cited the need for a sustainable cost structure and identifying overlaps as reasons for the layoffs. Microsoft Gaming CEO Phil Spencer reiterated this in a memo accompanying the initial announcement of the gaming department’s 1,900 layoffs last month.
Additionally, the tech giant affirmed its preparedness to reverse the acquisition, as per Game Rant. A company representative clarified that the deal allows for divestment from Activision, although such a scenario is deemed unlikely.
The FTC’s objections primarily pertain to antitrust matters rather than workforce protections, raising questions about whether recent layoffs across Activision subsidiaries would impact court approval of the acquisition.
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