Electronic Arts (EA) has announced that it will lay off 6% of its workforce as part of a move to focus on growth opportunities. The video game company, which had around 12,900 employees around this time last year, has grown its games in a number of areas, including FIFA 23, Apex Legends, and The Sims. EA CEO Andrew Wilson said the company has already begun making and communicating these decisions and expects the move to continue through to early next fiscal year.
Wilson said the restructuring would impact each part of the company “to varying degrees”. He added that the move will move everything towards core franchises, as well as new technologies like cloud gaming, AI, and digital marketing. He said that “new media trends” were reshaping the world and represented significant opportunities, but increasingly required that EA would be “focused on our strategic priorities”. These priorities, according to Wilson, were building games and experiences that entertained online communities, creating interactive storytelling, and providing social and creator tools to empower gamers in and around games.
The layoffs follow the announcement of the departure of three top executives from the company, such as chief design officer Patrick Söderlund, in August last year. Meanwhile, the company recently announced it would be delivering 14 games over the next five years, with eight of them being new franchises.
Despite his upbeat message about EA’s future, Wilson acknowledged that layoffs were difficult and said: “This is the most difficult part, and we are working through the process with the utmost care and respect. Where we can, we are providing opportunities for our colleagues to transition onto other projects. Where that’s not possible, we are providing severance pay and additional benefits such as health care and career transition services.”
EA is the latest games company to cut jobs in a period of industry turbulence that has seen a slowdown in video game sales across the globe. Shifting consumer attitudes have changed the way we consume games in particular, with a massive push towards cloud gaming services set to alter the industry further in the coming years.
Those who work in the sector, especially in roles that require a lot of creativity and passion, are vulnerable to being laid off because of how quickly trends can change. It is also noted that while video games companies are getting bigger, mergers and acquisitions often lead to closures and downsizing.
Despite a steady increase in overall revenue for the $138bn video game industry, there has recently been a slowdown in the rate of growth. Part of this is due to the fact that the industry was forced to switch quickly from selling games in a box to an online only model, a shift that impacted not just how games were sold but changed how we think about playing them. EA’s strategy is to focus on what it called “core franchises”, such as Madden NFL and FIFA soccer games instead of niche titles that may have a small, loyal following but don’t produce significant revenues.
GamesBeat Summit 2023 gives attendees a chance to connect with top gaming leaders in Los Angeles on May 22-23. The event offers an opportunity to hear the latest updates from within the gaming industry.
