2024-02-28 21:26:19
Electronic Arts will lay off 5% of its workforce as part of a restructuring plan that also includes reducing its real estate inventory. The company made the announcement on Wednesday as the video game industry struggles to grow amid high interest rates.
The company, which makes gaming titles such as “Star Wars Jedi: Survivor,” expects to incur costs of $125 million to $165 million related to the move.
Sony, Microsoft and Tencent-owned Riot Games have also laid off thousands of employees in recent months because the games market is only recovering slowly due to high loan interest rates.
“While not every team will be impacted, this is the most difficult part of these changes and we have considered all options to limit the impact on our teams,” CEO Andrew Wilson said in a letter to employees.
Of the costs, approximately $50 million to $65 million will be from office space reductions and $40 million to $55 million will be from severance and other employee-related costs, the company said.
The actions related to the plan are expected to be substantially completed by December 31.
As of March 31 last year, the company had regarding 13,400 employees, 65% of whom worked internationally, according to a regulatory report.
EA had forecast in January that fourth-quarter bookings would come in below estimates. (Reporting by Sourasis Bose in Bengaluru; Editing by Shailesh Kuber and Maju Samuel)
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