Summary
Digital Bros Group, one of the largest game developer-publishers in Europe, is laying off approximately 30% of its workforce. Its newly announced move is just the latest in a longseries of layoffs that has been hitting the gaming industrythroughout 2023.
The recent slowdown in global economic growth has led to a worsening outlook that influenced a variety of new monetary policies across the globe, many of which curbed the available venture capital that’s a frequent source of funding for gaming businesses, among other issues. According to the International Monetary Fund, the current downtrend stems from a combination of factors, including the persisting effects of the COVID-19 pandemic, rising interest rates meant to combat inflation, and the Russian invasion of Ukraine. As an indirect result of those circumstances, many game companies like EA, Ubisoft, CDPR, andBungie laid off a significant portion of their staffersin recent times.
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Digital Bros Says Layoffs Will Help It Align With ‘New Competitive Environment’
That group is now joined by Digital Bros, the parent company ofControlpublisher 505 Games. The Milan, Italy-based conglomerate recently started an organizational review spanning the entirety of its development studios and publishing arms that’s meant to help it deal with “the new competitive environment” it now finds itself in. While the full effects of the ongoing evaluation are yet to be seen,Digital Bros expectsto lay off approximately 30% of its global workforce as a direct result of the move.
The publicly traded company assured investors that the restructuring effort won’t meaningfully impact the previously projected financial results for its fiscal year 2024, largely on account of the resulting payroll savings. The layoffs themselves will primarily impact game developers working at Digital Bros subsidiaries, with the publisher explaining how the “predominant portion” of the cutbacks will be “concentrated within [its] studios.”
Many Game Developers Lost Their Jobs in November 2023
November has so far proven to be a difficult month for game industry professionals;Assassin’s Creeddeveloper Ubisoft Montreal eliminated nearly 100 roles earlier this month, while almost twice as many employees at Amazon’s gaming division lost their jobs during this period. Engine makerUnity also announced its fourth round of layoffs in 17 monthsin mid-November. The move was confirmed just asWarframedeveloper Digital Extremes laid off several dozen people, as well.
Although the very term “game developer” is often used synonymously with software engineers, it also applies to any other role that would typically be seen in any given game’s credits: localizers, marketing professionals, accountants, HR representatives, etc. As far as the U.S. side of the business is concerned, some industry watchers expect that the layoffs will slow down once the Federal Reserve stops hiking interest rates to curb inflation, consequently making debt cheaper and facilitating venture capital.
