It’s unfortunately time for yet another round of layoffs in the gaming industry as Take-Two Interactive announced a 5% reduction of its workforce. This translates to around 600 employees and follows similar reductions announced in the last few months by the likes of Epic Games, Riot Games, Microsoft, Sony, and Electronic Arts, not to mention many other such situations that occurred at smaller studios like Supermassive Games and Hidden Path Entertainment to name a couple.
Here’s the so-called ‘Plan’, or cost reduction program, as Take-Two outlined it in a newly released 8-K SEC filing:
On April 16, 2024 the Board of Directors of Take-Two Interactive Software, Inc. (the “Company”) approved a cost reduction program (the “Plan”) to identify efficiencies across its business and enhance the Company’s margin profile, while still investing for growth. As part of these efforts, the
Company is rationalizing its pipeline and eliminating several projects in development and streamlining its organizational structure, which will eliminate headcount and reduce future hiring needs. The Company estimates that it will incur approximately $160 million to $200 million in total charges in connection with the Plan. The Company expects $40 million to $60 million of the total charges to result in future cash expenditures. The total charge consists of approximately $120 million to $140 million related to title cancellations, approximately $25 million to $35 million associated with employee severance and employee-related costs, and approximately $15 million to $25 million related to office space reductions. The Plan is expected to be largely complete by December 31, 2024 and will reduce the Company’s workforce by approximately 5%.
Of course, that comes with the cancellation of ‘several projects’ in development, though we don’t know which those are. Most of them were likely still unannounced, though BioShock fans may well be wondering if the next iteration (announced four and a half years ago and still largely missing in action) in the first-person shooter franchise made the cut or not.
As a reminder, Take-Two recently bought Gearbox for $460 million from the Embracer Group while also confirming that a new Borderlands game is in development.
