In a move echoing recent trends across the tech industry, Sony announced on Tuesday that it is laying off around 900 employees, or 8% of its global workforce, within its PlayStation division. The company also plans to close its London Studio in the UK.
PlayStation chief Jim Ryan, in a note to employees, explained the decision as a necessary step for the division’s long-term growth and sustainability. He emphasized the need to “step back, look at our business holistically, and move forward focusing on delivering the best experiences possible for our community.”
Hermen Hulst, head of PlayStation Studios, provided further details in a separate message. He confirmed that the cuts would impact various studios across the Americas, Japan, EMEA, and APAC regions, including Insomniac Games, Naughty Dog, Guerrilla, and Firesprite. Additionally, some ongoing projects in various development stages will be discontinued.
This announcement comes just two weeks after Sony revised its sales forecast for the PlayStation 5 downwards, citing declining demand. The company now expects to sell 21 million units of the console in the current fiscal year, compared to its previous projection of 25 million. This news resulted in a significant drop in Sony’s share price.
Sony is not alone in facing these challenges. The gaming industry has seen several major companies announce job cuts in recent months. Microsoft laid off 1,900 employees from Activision Blizzard and Xbox, while Unity reduced its workforce by 25%. These layoffs reflect broader trends within the tech sector, with companies like Google, Snapchat, eBay, PayPal, DocuSign, Okta, Block, Discord, Twitch, and Duolingo all implementing significant workforce reductions.
The future trajectory of the PlayStation division and the wider gaming industry remains to be seen. While Sony’s decision is undoubtedly difficult, it highlights the need for adaptation and strategic maneuvering in the face of evolving market conditions.
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