Massive Job Cuts at Take-Two: 600 Employees Facing Layoffs

Massive Job Cuts at Take-Two: 600 Employees Facing Layoffs

Take-Two Interactive Software, the publisher behind popular games like ‘Grand Theft Auto,’ is making significant changes that will impact its workforce. The company announced that it will be laying off approximately 600 employees, which accounts for about 5% of its total workforce. This decision comes as part of a broader effort to streamline operations and improve efficiency.

In addition to reducing its workforce, Take-Two Interactive Software is also halting the development of several projects to cut costs. Although specific details about the canceled projects were not disclosed, the company anticipates that these measures will lead to charges of up to $200 million. By implementing these changes, Take-Two expects to save over $165 million annually.

The company’s shares experienced a 1% increase in extended trading following the announcement. However, Take-Two’s stock has seen a decline of nearly 10% since the beginning of the year, reflecting the challenges faced by the video game industry.

Take-Two’s restructuring aligns it with other gaming giants like Riot Games, Electronic Arts, and Sony, all of which have downsized their workforce this year due to uncertainties related to consumer spending post-pandemic.

Research from Newzoo suggests that the growth in PC and console gaming revenue is not expected to reach pre-pandemic levels until 2026. This trend is attributed to gamers spending less time playing, impacting the overall revenue generated by the industry.

The canceled projects will contribute significantly to the total charges incurred, with estimates reaching up to $140 million. Additionally, expenses related to severance and employee-related costs are projected to be as high as $35 million. As part of the restructuring, Take-Two Interactive Software will also reduce its office space.

With a workforce of over 11,000 employees as of March 2023, Take-Two recently made headlines for its acquisition of Gearbox, the studio behind ‘Borderlands,’ for $460 million. This move, made during a period of industry consolidation, underscores the company’s strategic positioning in the market.

While Take-Two remains focused on developing the next installment of the highly successful ‘Grand Theft Auto’ series, there are speculations that the release date for the game may be pushed back to 2026 from its initial target of 2025. These changes reflect the dynamic nature of the gaming industry and the adaptability required to navigate its evolving landscape.

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