Electronic Arts (EA), the well-known U.S.-based developer of popular games such as FIFA (now called FC), Battlefield, and Apex Legends, disclosed intentions to cut its workforce by 5% as part of a larger strategy involving the reduction of office space and cessation of specific video game projects.
According to its latest annual Securities and Exchange Commission (SEC) filing in May, the company will house 13,400 employees by the end of March 2023, which indicates that about 670 jobs will be affected by the layoffs.
EA's announcement is the latest in a series of job cuts in the video game industry.
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EA Concentrating on Bigger Opportunities
EA CEO Andrew Wilson outlined the company's restructuring efforts to offer fans more immersive experiences worldwide, which is projected to be mostly finished by the end of December and will support EA's strategic goals and growth plans.
EA has seven U.S. offices in Seattle, Orlando, Austin, Los Angeles, Marina Del Rey, Sacramento, and Redwood City, California, 14 in Europe, five in Asia, six in Canada, and two in Australia.
Wilson also mentioned that the discontinuation will optimize their global real estate footprint to support the business best. Still, it remains uncertain if this will impact the company's Redwood City headquarters. EA spokesperson Charlie Fortescue declined to address questions regarding the layoffs and real estate reductions to SFGATE.
Additionally, they are sunsetting games and discontinuing the development of future licensed IPs that they do not believe will be successful in the changing industry. These measures enable EA to concentrate on its "biggest opportunities," such as its owned IP, sports, and massive online communities.
Last month, Wilson stated in the company's third-quarter earnings call that they plan to keep investing in popular gaming franchises with big online followings like Apex Legends, Battlefield, EA Sports FC, Madden NFL, and The Sims.
Wilson's communication did not detail severance arrangements for EA staff. Still, the SEC filing mentioned anticipated expenses of forty million to fifty-five million dollars for severance and associated personnel costs.
Broader Pattern of Layoffs in the Gaming Sector
EA's decision aligns with a broader pattern observed in the gaming sector, with many developers undergoing substantial workforce reductions. Sony, for example, disclosed layoffs in its PlayStation division, impacting approximately 900 employees worldwide. Jim Ryan, the outgoing President and CEO of Sony Interactive Entertainment, conveyed these adjustments, emphasizing the necessity for strategic changes to foster business expansion and progress.
Notable game developers affected include studios such as Insomniac, known for the Spider-Man series, Naughty Dog, famous for The Last of Us, and Guerrilla Games, the creator of Horizon. Reports indicate that Guerrilla Games may downsize its workforce by about 10%, impacting roughly 40 employees. Sony also confirmed the closure of its PlayStation operations in London, known for its SingStar series and virtual reality games.
EA's announcement mirrors actions taken by other industry leaders like Microsoft and Tencent's Riot Games. Microsoft recently reduced its gaming unit workforce by 1,900 positions after acquiring Activision Blizzard, while Riot Games downsized its workforce by 11%.
