Saturday, May 18, 2024
HomeMicrosoftSony is laying off 900 PlayStation employees

Sony is laying off 900 PlayStation employees

Sony has announced the termination of approximately 900 employees from its PlayStation division, constituting roughly 8 percent of its global workforce. This decision will affect various PlayStation studios such as Insomniac Games, Naughty Dog, Guerrilla Games, and Firesprite. These layoffs align with a broader trend of job cuts within the gaming and tech sectors in 2024.

PlayStation chief Jim Ryan stated,

“We have reluctantly decided to implement a reduction in our overall workforce by approximately 8 percent, equating to around 900 individuals, pending adherence to local regulations and consultation procedures. This decision impacts employees worldwide, including those within our studios.”

Multiple PlayStation studios will bear the brunt of these layoffs, including the closure of Sony’s London Studio in the UK, responsible for developing PlayStation VR games. Additionally, there will be job cuts affecting Firesprite studio, known for its work on PlayStation VR’s Horizon Call of the Mountain game. Sony also recently announced its plans to introduce PSVR 2 support for PC.

On a related matter, Hermen Hulst, who leads PlayStation Studios, has indicated that the effects of the layoffs extend to US-based studios such as Insomniac Games and Naughty Dog, as well as Sony’s Guerrilla studio located in the Netherlands. The impact of these measures will be felt across regions including the Americas, Japan, as well as the EMEA and APAC regions.

After careful consideration and many leadership discussions over several months, it has become clear changes need to be made to continue to grow the business and develop the company,”


“We had to step back, look at our business holistically, and move forward focusing on the long-term sustainability of the company and delivering the best experiences possible for our community.”

The layoffs coincide closely with Sony failing to meet its PS5 sales target, resulting in a significant drop of $10 billion in Sony’s stock price. Beyond the PS5 sales shortfall, analysts have highlighted a nearly decade-low margin for games, indicating that the rising costs of game development are eroding Sony’s gaming profitability.

Sony President Hiroki Totoki recently discussed the potential for expanding PlayStation games onto the PC platform, suggesting that Sony is intensifying its focus on PC and mobile gaming initiatives. Hermen Hulst further elaborated on this shift, stating, “Expanding and sustaining social and online experiences—enabling PlayStation gamers to engage with our worlds in diverse ways—as well as launching games on additional platforms such as PC and Mobile, necessitates a distinct strategy and allocation of resources.”

The gaming industry has been rocked by successive waves of layoffs recently, casting a shadow over the standout games of 2023. Last month, Microsoft initiated significant layoffs, affecting approximately 1,900 employees from both Activision Blizzard and Xbox, representing about eight percent of the total Microsoft Gaming division workforce. Additionally, Unity announced a workforce reduction of 25 percent, while Discord followed suit with a layoff affecting 17 percent of its employees.

Here’s the full memo from Ryan:

Team,

It is important to provide you with updates about the business as often as possible. Today, I am writing with sad news. Through discussions over the past few months about the evolving economic landscape, changes in the way we develop, distribute, and launch products, and ensuring our organization is future-ready in this rapidly changing industry, we have concluded that tough decisions have become inevitable. The leadership team and I made the incredibly difficult decision to restructure operations, which regrettably includes a reduction in our workforce impacting very talented individuals who have contributed to our success.

After careful consideration and many leadership discussions over several months, it has become clear changes need to be made to continue to grow the business and develop the company. We had to step back, look at our business holistically, and move forward focusing on the long-term sustainability of the company and delivering the best experiences possible for our community. The goal is to streamline our resources to ensure our continued success and ability to deliver the experiences gamers and creators have come to expect from us.

I want to be as transparent as possible with you, our partners, and our community about what this means:

We envision reducing our headcount by about 900 people, or about 8% of our current workforce

There will be impact for employees across all SIE regions – Americas, EMEA, Japan, and APAC

Several PlayStation Studios are affected

I know that receiving this news will be hard and unsettling and you are wondering what this means for you. Timelines and procedures for how we approach this will vary based on your location due to local laws and regulations.

For those of you in the US, all impacted employees will be notified today.

In the UK, it is proposed:

That PlayStation Studios’ London Studio will close in its entirety;

That there will be reductions in Firesprite studio;

And that there will be reductions in various functions across SIE in the UK.

The proposed changes mean that we will enter a period of collective consultation before any final decisions are taken. All employees who are part of the collective consultation will be made aware of the next steps today.

In Japan, we will implement a next career support program. Details will be communicated separately.

In other countries, we will begin conversations with those who are potentially at risk or impacted as a result of this proposed course of action.

For those who will be leaving SIE: You are leaving this company with our deepest respect and appreciation for all your efforts during your tenure.

For those who will be staying at SIE: We will be saying goodbye to friends and colleagues that we cherish during this process, and this will be painful. Your resilience, sensitivity, and adaptiveness will be critical in the weeks and months to come.

This will not be easy, and I am aware of the impact it will have on wellbeing. Affected employees will receive support, including severance benefits. While these are challenging times, it is not indicative of a lack of strength of our company, our brand, or our industry. Our goal is to remain agile and adaptable and to continue to focus on delivering the best gaming experiences possible now and in the future.

Thank you for your understanding during this difficult period. Please be kind to yourselves and to each other.

Jim

RELATED ARTICLES

LEAVE A REPLY

Please enter your comment!
Please enter your name here

- Advertisment -

Most Popular

Recent Comments