Riot Games' CEO Dylan Jadeja has officially announced the gaming firm is planning to lay off 530 employees or roughly 11% of its staff, with the job cuts set to impact the teams outside core development the most, Reuters reports.
Explaining the reason for the layoffs, the CEO stated that Riot Games currently appears to be a firm that lacks focus with the company being engaged in too many "things." The letter further stated that Riot has made some large investments, some of which are not yielding the returns that management had anticipated.
Jadeja further stated in the letter that the company's expenses have increased to the point that it is "unsustainable."
IGN adds that the layoffs rollout strategy will depend on local legislation, but is projected to start over the next hour and finish in the upcoming weeks. Riot is providing cash incentives, a minimum of six months' pay to all laid off employees, along with a host of other benefits and assistance.
In addition, the organization is reportedly also requesting its staff to postpone meetings for the upcoming week and, if feasible, work from home while team members assess the circumstances.
Riot Forge Closure
As per reports, the announcement also states that the adjustments will prompt the closure of Riot Forge whereas the Runeterra card game Legends of Runeterra will still be updated but with a focus on sustainability.
Following the launch of its sixth game, Bandle Tale: A League of Legends Story, Riot said that Riot Forge will no longer be developing new games. The Forge was reportedly a cooperation program that allowed independent developers to collaborate in producing single-player games that recounted tales set in the League of Legends realm.
Legends of Runeterra, a card game developed by Riot, will reportedly prioritize sustainability above new features. Specifically, the game is shifting more toward the PvE Path of Champions mode, which allows the surviving crew to explore more in that area. The developers blamed funding problems for this.
Regarding the remainder of Riot's portfolio, IGN adds Riot promises that its teams will be given priority and that League of Legends, Valorant, Teamfight Tactics, and Wild Rift will all be more ambitious than before.
Industry-Wide Layoffs
Reuters states that Riot Games' layoffs comes amidst rising inflation with players delaying purchasing pricey games or playing fewer games, reportedly making it difficult for digital game companies to expand. Riot Games' layoffs also follows Electronic Arts Inc.'s 6% workforce cuts as well as giving up some office space at the beginning of the year.
Tech layoffs proves to have rendered an estimated of 10,000 people to lose their jobs in the industry last year, according to IGN. Whereas the number in the first month of 2024 alone is quickly approaching 4,000 due to studio closures, project cancellations, and a tragic trend that looks likely to continue well into the remainder of the year.
