Sony said Tuesday it is laying off about 900 staffers, or 8% of its workforce in its PlayStation division.
Cuts in the U.S. will take place at Insomniac Games and Naughty Dog, along with the company’s technology, creative, and support teams, Hermen Hulst, head of Playstation Studios, said in a memo posted to the Sony Interactive Entertainment website.
In addition, Playstation Studios’ London location will close, and there will be reductions in other units in the U.K. including Firesprite in Liverpool and elsewhere in Europe, including Guerrilla Games in Amsterdam
The note said that some projects will not go forward, but did not specify which ones are targeted.
“Our industry has experienced continuing and fundamental change which affects how we all create, and play, games,” Hulst’s memo said. “Delivering the immersive, narrative-driven stories that PlayStation Studios is known for, at the quality bar that we aspire to, requires a re-evaluation of how we operate.”
The company will need “a different approach and different resources,” the memo continued, adding that “growth itself is not an ambition.”
“Our philosophy has always been to allow creative experimentation,” he said. “Sometimes, great ideas don’t become great games. Sometimes, a project is started with the best intentions before shifts within the market or industry result in a change of plan.”
The cuts follow layoffs at other video game companies in recent months,, including 1,900 jobs lost from Microsoft’s Blizzard and Xbox in January. In September “Fortnite” maker Epic Games slashed 830 jobs.
“We have made the extremely hard decision,” outgoing Sony Interactive CEO Jim Ryan said in a blog post. “These are incredibly talented people who have been part of our success, and we are very grateful for their contributions. However, the industry has changed immensely, and we need to future ready ourselves to set the business up for what lies ahead. We need to deliver on expectations from developers and gamers and continue to propel future technology in gaming, so we took a step back to ensure we are set up to continue bringing the best gaming experiences to the community.”
Sony earlier this month cut its forecast for sales of its PlayStation 5 console by 4 million, to 21 million, citing lower demand.
Sony Group’s U.S.-traded shares gained 4 cents after the opening bell to $86.11. Shares are down about 8% since the start of the year.
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