Japan’s Sony announced on Tuesday that it will cut approximately 900 jobs at its PlayStation unit and close a studio in London.
The job reductions will impact around 8% of the division’s workforce across regions spanning the Americas to Asia. This decision comes shortly after Sony revised the annual sales forecast for its PlayStation 5 console.
Sony’s gaming chief, Jim Ryan, stated, “We have concluded that tough decisions have become inevitable,” attributing them to changes in how the videogame industry develops, distributes, and launches products. Ryan is slated to retire in March.
This move aligns Sony with industry peers such as Microsoft and Tencent-owned Riot Games, both of which have undergone significant layoffs in recent months due to the slow recovery in the gaming market.
According to industry tracker Newzoo, the global videogame market grew by just 0.6% last year, reaching $184 billion. While this was an improvement over the more than 5% decline in 2022, it underscores the challenges in the industry.
The layoffs will also impact other Sony studios, including U.S.-based Insomniac Games, known for titles like “Marvel’s Spider-Man 2,” and Naughty Dog, the studio behind “The Last of Us.”
Earlier this month, Sony indicated expectations for a gradual decline in unit sales of the PlayStation 5 in the next financial year. Additionally, the company does not plan to release any major franchise titles in the coming fiscal year.
Since its launch in late 2020, the PlayStation 5 has accumulated lifetime sales of over 50 million units, rebounding after a slow start marked by pandemic-induced supply shortages limiting device production for the entertainment conglomerate.
