Updated February 28th, 2024 at 10:09 IST

Sony lays off nearly 8% of PlayStation employees, shuts down London Studio

The layoffs come shortly after Sony slashed its annual sales projections for the PlayStation 5 console.

Reported by: Business Desk
Sony PlayStation layoffs | Image:Unsplash
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Sony PlayStation layoffs: Japan's Sony has decided to cut approximately 900 jobs within its PlayStation unit and shutter a studio in London, signalling challenges for the videogame industry amidst a post-pandemic downturn.

The layoffs, impacting roughly 8 per cent of the division's workforce spanning regions from the Americas to Asia, come shortly after Sony slashed its annual sales projections for the PlayStation 5 console.

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Image: Unsplash

Jim Ryan, Sony's gaming chief, said, "We have concluded that tough decisions have become inevitable," attributing the move to shifts in the development, distribution, and launch processes within the videogame industry. Ryan is scheduled to retire in March.

This decision aligns Sony with industry peers such as Microsoft and Tencent-owned Riot Games, both of which have undertaken significant layoffs in recent months due to sluggish recovery in the gaming market.

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According to industry tracker Newzoo, the global videogame market expanded by a modest 0.6 per cent last year to reach $184 billion, a slight improvement from the more than 5 per cent decline witnessed in 2022.

The impact of the layoffs extends beyond Sony's PlayStation unit to include other studios, notably US-based Insomniac Games, renowned for titles like "Marvel's Spider-Man 2," and Naughty Dog, the creative force behind "The Last of Us."

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Earlier this month, Sony announced expectations for a gradual decline in unit sales of the PlayStation 5 starting from the next financial year, coupled with plans to abstain from releasing major franchise titles in the upcoming fiscal year.

Image: Unsplash

Despite challenges, the PlayStation 5 has amassed lifetime sales exceeding 50 million units since its late 2020 launch, overcoming initial hurdles stemming from supply shortages caused by the pandemic, which constrained the entertainment conglomerate's device production capabilities.

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Published February 28th, 2024 at 09:23 IST