Sony, the Japanese electronics giant, announced on Tuesday that it will be laying off approximately 900 employees from its PlayStation division and closing a studio located in London. This decision comes amid ongoing challenges for the videogame industry as it seeks to rebound from a downturn following the pandemic.
The job cuts represent around 8 percent of the division’s workforce across the Americas and Asia and follow Sony’s recent downward revision of its annual sales forecast for the PlayStation 5 console.
Jim Ryan, the head of Sony’s gaming division who is set to retire in March, stated, “We have concluded that tough decisions have become inevitable,” attributing the layoffs to significant shifts in how the gaming sector develops, distributes, and launches its products.
This restructuring aligns Sony with industry peers such as Microsoft and Riot Games, a subsidiary of Tencent, both of which have also laid off thousands of employees in response to the slow recovery in the gaming market.
According to industry analyst Newzoo, the global video game market experienced minimal growth of just 0.6 percent last year, reaching a value of $184 billion (approximately Rs. 15,25,664 crore). This was a modest improvement compared to a decline of over 5 percent in 2022.
In addition to the job cuts at the PlayStation division, Sony’s other game studios will also be impacted, including Insomniac Games, renowned for titles like Marvel’s Spider-Man 2, and Naughty Dog, known for The Last of Us.
Earlier this month, Sony projected a gradual decrease in PlayStation 5 unit sales starting in the next financial year and indicated that no major franchise titles are slated for release in the forthcoming fiscal year.
Since its rollout in late 2020, the PlayStation 5 has achieved lifetime sales exceeding 50 million units, overcoming initial production challenges stemming from pandemic-related supply shortages.
© Thomson Reuters 2024
