Developers hit hardest by new layoff operations, 500 to go in publishing, 100 in corporate
Electronic Arts has revealed that the vast majority of its global staff cuts will be made in its own development studios.
Some 900 EA developers across numerous studios will be laid off, compared to the 500 cuts in publishing and 100 in corporate affairs.
The total staff cuts are expected to save EA as much as $100 million annually. Yesterday the company confirmed it has bought social studio Playfish for as much as $400 million.
“These changes will make us more efficient in our core packaged goods business while allowing us to focus investment on our key titles and to expand our digital direct initiatives,” said EA CFO Eric Brown.
EA CEO John Riccitiello said the huge staff cuts were an unpleasant but necessary step.
“Laying off employees and closing facilities is never pleasant. We have a lot of compassion for those impacted but these cuts are essential for transforming our company,” he said.
“Our operating expenses will be reduced by at least $100 million compared to our current run rate.
“We are implementing a thoughtful, targeted action that will reduce titles, close several facilities and decrease headcount by approximately 1,500 positions, of which 1,300 will be included in a restructuring plan.
Elsewhere in the financial posting, Riccitiello was bullish about the firm’s performance and prospects.
“Our Q2 revenues exceeded street expectations,” he said. “In a sector that has struggled for growth in recent quarters, our non-GAAP net revenue is up 13% fiscal year-to-date. So far this fiscal year, EA has out-performed on share in a down retail market.
“EA is performing,” he added.