The gaming industry is facing turbulent times, and the latest casualty appears to be Take-Two Interactive. Renowned for acclaimed franchises like Grand Theft Auto and Red Dead Redemption, the gaming titan has announced plans to lay off around 5% of its workforce, which equates to over 500 employees.
The cuts are part of a broader "cost reduction program" to boost the company's operations and improve its financial margins. Take-Two stated that the layoffs will result in the cancellation of several unnamed game projects currently in development, with the total charges expected to reach $160–200 million.
This includes around $120-140 million related to the canceled titles, $25-35 million in employee severance costs, and $15-25 million from scaling back office spaces. The company expects the restructuring to be largely complete by the end of the year, generating an estimated $165 million in annual savings.
Surprisingly, this news comes just weeks after Take-Two successfully closed its $460 million acquisition of Borderlands developer Gearbox Entertainment. What's more, despite recent strong financial performance, including a $1.37 billion revenue quarter, the company's leadership felt these drastic measures were necessary.
"As part of these efforts, the company is rationalizing its pipeline and eliminating several projects in development and streamlining its organizational structure, which will eliminate headcount and reduce future hiring needs," Take-Two stated in its SEC filing.
These layoffs are the latest in a troubling trend sweeping across the gaming industry. Thousands of developers have lost their jobs over the past year, with large companies like Microsoft, Meta, and Spotify all implementing major workforce reduction strategies. The reasons cited are often the same: a need to cut costs, improve efficiency, and weather economic uncertainty.
