In a major shakeup, Sony has announced plans to lay off approximately 900 employees, constituting 8 percent of its global PlayStation workforce.
The move comes as part of a broader restructuring effort, which includes the complete closure of PlayStation’s London Studio.
The decision was communicated to employees via an email shared in a blog post by Sony CEO Jim Ryan, who described the move as “sad news” and acknowledged it as a challenging day for the company.
Ryan expressed that the leadership team found the restructuring necessary, leading to the regrettable decision to reduce the workforce.
This announcement follows Microsoft’s recent revelation of plans to cut 1,900 jobs within its gaming division, which encompasses the recently acquired Activision-Blizzard.
A shake-up for the gaming industry
Halli Bjornsson, Head of UK developer Lockwood Publishing, noted, “Sony is one of the big pillars of UK game development culture, so it’s massive to see the legendary Sony London studio close in particular.” He emphasised the challenging period for the gaming industry but expressed optimism in the resilience of UK games talent.
Sony’s London Studio, founded in 2002 through the merger of two London-based studios under the PlayStation brand, has been instrumental in creating popular series such as SingStar and This Is Football. In recent years, it focused on virtual reality (VR) games exclusive to Sony’s headset, including VR Worlds and the well-received shooter Blood & Truth. The studio was reportedly working on an “unannounced online co-op combat game” set in London before the announcement.
Rising developing costs
Despite the success of Sony’s PlayStation 5, which has sold over 50 million units globally—more than double the sales of Microsoft’s Xbox Series X/S—the company faces challenges. Nintendo’s Switch console, released three years earlier, has sold almost 140 million units worldwide. Sony’s February earnings report revealed a lower-than-expected console sales projection, with a 16 percent increase in revenue compared to the previous year but a 25 percent decrease in operating income.
Piers Harding-Rolls, a gaming industry analyst at Ampere Analysis, commented, “Sony Interactive Entertainment becomes the latest in a long list of games companies that have laid off a significant number of staff in the last 12-18 months.” He attributed this trend to the rising costs of developing big-budget games and the challenges posed by the post-pandemic gaming market, characterised by increased commercial risk.
As the gaming industry navigates these turbulent times, the closure of Sony’s London Studio underscores the broader adjustments occurring within major players in the sector.
Amelia Brand is the Editor for HRreview, and host of the HR in Review podcast series. With a Master’s degree in Legal and Political Theory, her particular interests within HR include employment law, DE&I, and wellbeing within the workplace. Prior to working with HRreview, Amelia was Sub-Editor of a magazine, and Editor of the Environmental Justice Project at University College London, writing and overseeing articles into UCL’s weekly newsletter. Her previous academic work has focused on philosophy, politics and law, with a special focus on how artificial intelligence will feature in the future.
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