2023’s great games were overshadowed by a dark cloud of layoffs

30.12.2023 - 15:37 / theverge.com / Tim Sweeney

By Ash Parrish, a reporter who has covered the business, culture, and communities of video games for seven years. Previously, she worked at Kotaku.

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Layoffs are an unfortunate reality of any industry, but the scope and scale of video game layoffs in 2023 are far beyond a typical year. More than any specific video game or piece of news, layoffs defined the past 12 months. Companies large and small have felt their impact. Unofficial figures estimate 9,000 workers have been affected, and at the heart of it all are corporations that valued growth at all costs — including people.

In September, Epic Games laid off 830 employees. In a statement, CEO Tim Sweeney wrote, “We’ve been spending way more money than we earn. [...] I had long been optimistic that we could power through this transition without layoffs, but in retrospect I see that this was unrealistic.” Some of that spending was on companies like SuperAwesome and Bandcamp which Epic bought in 2021 and 2022, respectively. Both companies were sold off shortly after Epic announced layoffs. 

Epic makes Fortnite, a multibillion-dollar revenue generator; it licenses the Unreal Engine software that many developers use to make games, including Final Fantasy VII Remake, Lies of P, and Star Wars Jedi: Survivor; and it has its own (unprofitable) gaming storefront. And Epic still spent so much of that money that, in order to maintain a level of profitability acceptable to investors, it had to let 830 people go. 

Over the last two years, Embracer Group has made headlines for its numerous purchases of gaming studios, media companies, and the IP rights to The Lord of the Rings. This year, the company made an immediate about-face and began a massive restructuring program because of a $2 billion dollar investment deal that fell through. Axios reported that deal was with Savvy Games Group, the gaming arm of the Saudi government’s Public Investment Fund. In the aftermath of this failed investment strategy, Embracer has shuttered three studios, is looking to sell others, canceled numerous projects, and has laid off over 900 employees. 

These are just the biggest, most egregious examples. Hasbro laid off 1,000 employees, including most of the team that worked on Baldur’s Gate 3 with Larian Studios. EA laid off 6 percent of its workforce or around 780 people. BioWare, Microsoft, Bungie, Naughty Dog, Ubisoft, Amazon, CD Projekt Red, Sega, Unity, and Activision Blizzard were all hit, just to name a few. And in the face of these devastating layoffs, the ramifications of which we have yet to see, one of the industry’s biggest, most-watched events failed to even acknowledge this