Grand Theft Auto’s owner plans to lay off 5% of its workforce

Take-Two Interactive Software, the publisher of the renowned “Grand Theft Auto” franchise, has announced plans to lay off approximately 5% of its workforce, equivalent to around 600 employees, amid ongoing restructuring efforts within the video-gaming industry. 

The company disclosed on Tuesday that it will also discontinue several projects currently in development as part of a cost-reduction initiative, anticipating total charges of up to $200 million. However, it refrained from disclosing the specific projects affected by the cancellations.

Take-Two anticipates that these measures will yield more than $165 million in annual cost savings. Despite the announcement of the workforce reduction, the company’s shares saw a 1% increase in extended trading. Nonetheless, they have experienced a nearly 10% decline since the beginning of the year.

This decision places Take-Two in line with other industry players, including Tencent-owned Riot Games, Electronic Arts, and Sony Corp of Japan, which have also undergone staff reductions this year due to uncertain consumer spending following the pandemic-induced surge.

The revenue growth in PC and console gaming is predicted to remain below pre-pandemic levels until 2026. The stagnations is attributed to decreased gaming hours among players. Canceled projects are projected to contribute up to $140 million to the total charges, while severance and employee-related expenses are estimated to be as high as $35 million. Additionally, Take-Two will downsize some office spaces as part of the restructuring.

With approximately 11,580 full-time employees as of March 2023, Take-Two recently announced its acquisition of “Borderlands” creator Gearbox for $460 million, a move aimed at capitalizing on industry consolidation trends.

While Take-Two has been concentrating on developing the next installment in the highly successful “Grand Theft Auto” franchise, reports suggest that the release date might be postponed from 2025 to 2026.

Leave a Reply

Your email address will not be published. Required fields are marked *