Sony is slicing away nearly 1,000 jobs across its gaming division, shutting down a storied London studio in the process. The harsh cuts landed just days after Sony slashed PS5 sales projections, underscoring the gathering storm clouds above the video game industry.
On Tuesday, Sony gaming chief Jim Ryan announced the layoffs, which will trim around 8% of the division’s staff across the Americas, Europe and Asia. Ryan justified the “tough decisions” as a necessary reaction to upheavals in how games get made, sold and updated nowadays.
The job carnage aligns Sony with other gaming giants similarly spooked by the industry’s stumbling recovery from the pandemic boom. Microsoft, Tencent and Riot Games have purged thousands of workers in recent months amid persistent market doldrums.
The global video game haul expanded just 0.6% last year to $184 billion, per industry tracker Newzoo. And 2023 could deliver even more pain than 2022’s 5% decline.
No Sony gaming outpost will be spared in the impending bloodletting. The iconic Naughty Dog studio behind “The Last of Us” will see jobs lost. So too will Insomniac Games, developer of “Spider-Man” and other smash hits.
Sony clearly aims to spark a turnaround by any means necessary. Earlier this month, the company projected gradually slowing PS5 sales starting next fiscal year. And it plans no major franchise releases in that entire period.
This shock therapy may well pay off eventually. The PS5 has sold over 50 million units since its late 2020 debut, despite struggling for years with pandemic-induced supply issues.
But for now, Sony’s gaming business faces a harsh reset as its leadership pipeline also sees turnover. After spearheading countless PlayStation successes over the years, Jim Ryan himself plans to retire this March.
