Date : 17-04-2024
Take-Two Interactive Software, the renowned company responsible for the acclaimed “Grand Theft Auto” series, has revealed plans to reduce its workforce by approximately 5 percent, affecting around 600 employees. This move aligns with a broader trend in the industry, where various companies have been downsizing for over two years. Alongside this announcement, Take-Two disclosed intentions to halt several ongoing projects as part of cost-saving measures aimed at streamlining operations and improving expense management. However, specific details regarding these canceled projects were not provided.
The company expects these layoffs and project terminations to result in charges of up to $200 million. It’s estimated that canceled projects could contribute around $140 million to these charges, while costs related to severance and other employee-related expenses may amount to up to $35 million. Take-Two anticipates that these measures will yield annual cost savings of over $165 million.
This downsizing mirrors challenges faced across the gaming industry, with companies such as Tencent’s Riot Games, Electronic Arts, and Sony Corp also implementing workforce reductions this year. These actions are responses to the changing economic landscape post-pandemic, marked by a decrease in consumer spending and slower growth in revenues from PC and console gaming. Research firm Newzoo predicts that this sluggish growth will persist through 2026, remaining below pre-pandemic levels.
Additionally, Take-Two recently broadened its portfolio by acquiring Gearbox, the developer behind “Borderlands,” for $460 million. This acquisition highlights the ongoing consolidation in the gaming sector, leading to increased acquisition costs for popular titles. Despite the current financial and operational adjustments, Take-Two remains committed to developing the next installment of its flagship “Grand Theft Auto” series, although reports suggest a potential delay in its release from 2025 to 2026.
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