Sony Interactive Entertainment has revealed plans to lay off approximately 900 employees from its PlayStation division, constituting 8% of its global workforce. The decision reflects the company's strategic realignment efforts aimed at driving sustained business growth and organizational development.
Sony Layoff Impacts Many Game Studios
In a public email addressed to employees, Jim Ryan, President and CEO of the PlayStation unit, emphasized the necessity of these changes following extensive deliberations among company leadership. The layoffs will impact personnel across all regions, with the complete closure of PlayStation's London studio and other studios facing significant adjustments.
Sony Interactive Entertainment announces a reduction in its global workforce: https://t.co/O5hLTYGltq
— PlayStation (@PlayStation) February 27, 2024
Related Article: PS5 Pro Leak: YouTuber Says Upcoming Console Is a '4K Ray-Tracing Monster'-Why?
Sales Forecast Revision
The move follows Sony's downward revision of sales projections for its flagship PlayStation 5 console on February 14, citing lower-than-expected demand.
According to CNBC, the company now anticipates selling 21 million units of the PS5 in the current fiscal year, down from the initial forecast of nearly 25 million consoles. This adjustment led to a notable decline in Sony's stock value.
Is PlayStation 5 Pro Coming Soon?
Analysts had speculated about Sony's potential release of an updated version of the PlayStation 5 this year to stimulate consumer interest. However, the workforce reduction underscores Sony's focus on streamlining operations amid evolving market dynamics.
Speaking of PS5 Pro, we previously reported that it might launch in late 2024. The report came following the declining sales of the current gaming console in the market.
Tech Layoffs See No Signs of Stopping
Sony's announcement aligns with recent trends in the technology sector, including Microsoft's gaming unit layoffs following its acquisition of Activision Blizzard. Additionally, companies like Cisco and DocuSign have unveiled workforce reduction plans as part of broader restructuring initiatives.
Decline in Sony's Shares
Despite the news, Sony's stock performance remained relatively stable on Tuesday morning, reflecting investor confidence in the company's long-term strategic vision and adaptability in navigating industry challenges.
"While these are challenging times, it is not indicative of a lack of strength of our company, our brand, or our industry. Our goal is to remain agile and adaptable and to continue to focus on delivering the best gaming experiences possible now and in the future," Ryan said in a report by Euronews.
In other news, AI Pin maker Humane has partnered with SK Telecom, a known carrier in South Korea. The partnership anticipates bolstering the sales of the wearable device in the new foreign market.
Humane believes that the collaboration could greatly affect the lives of South Korean users in the country, especially those who use AI to lighten their loads of daily tasks.
