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Sony Cuts 900 Jobs in Gaming, Shuts Down a London Division

(Bloomberg) -- Sony Group Corp. will lay off 900 people across its video-game division worldwide, or about 8% of its employees, and close a group in London.

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“After careful consideration and many leadership discussions over several months, it has become clear changes need to be made to continue to grow the business and develop the company,” departing Sony Interactive Entertainment President and Chief Executive Officer Jim Ryan wrote Tuesday in a note to staff, addressing the cuts.


Sony said the layoffs will also impact game makers Insomniac (the studio behind Spider-Man), Naughty Dog (The Last of Us) and Guerrilla Games (Horizon), three of its most successful subsidiaries. Guerrilla Games is cutting 10% of its staff, roughly 40 employees, according to people familiar with the matter. Sony’s PlayStation London, best known for the SingStar series, as well as multiple virtual reality games, will shut down.

Head of PlayStation Studios Hermen Hulst said in a note to staff Tuesday that the company has decided to cancel several games in development. “Sometimes, great ideas don’t become great games,” he wrote. “Sometimes, a project is started with the best intentions before shifts within the market or industry result in a change of plan.”

The PlayStation maker previously made huge investments in “games as a service,” or online games designed to be monetized over a long period of time. But the market for these games has become oversaturated, and many have flopped. Sony recently canceled online games based on Spider-Man and The Last of Us.

As part of the cuts, the company also canceled a service game based on the Twisted Metal racing franchise, which was in development at the UK-based subsidiary Firesprite, which was also impacted by the layoffs, according to a person familiar.

Sony shares plunged earlier this month on news that it was cutting projections for its PlayStation 5 console. In comments to shareholders, Sony Interactive Entertainment Chairman Hiroki Totoki said the company was looking to boost margins and improve its development efficiency.

More than 6,000 video-game industry workers have lost their jobs this year as budgets have skyrocketed and game companies have faced a post-pandemic spending slowdown and rising interest rates.

Read More: Inside a New Era for Microsoft—And Gaming

(Updates with additional details on the cuts, starting in the third paragraph)

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