Fifa video game publisher Electronic Arts to cut 6% of workforce, reduce office space

Electronic Arts Inc said on Wednesday (March 29) it would lay off about 6per cent of its workforce and reduce office space, making it the first major videogame publisher to announce job cuts.

Technology firms have led the latest round of layoffs as US companies brace for a potential economic downturn amid rising interest rates around the world.

Meta Platforms Inc and Amazon.com Inc announced a second round of job cuts this month. Tech layoffs hit 63,000 in the first two months of the year, according to data from Challenger, Gray & Christmas Inc.

EA, which had about 12,900 staff at the end of March last year, expects to incur between $170 million (S$752 million) and $200 million in charges related to the restructuring.

"As we drive greater focus across our portfolio, we are moving away from projects that do not contribute to our strategy, reviewing our real estate footprint, and restructuring some of our teams," CEO Andrew Wilson said in a blog post.

EA, behind the Fifa soccer videogame franchise and The Sims, will provide opportunities for employees to move to other projects and where that is not possible will provide severance pay and additional benefits, Wilson said.

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Video game publishers are also struggling with a slowdown in player spending in the face of decades-high inflation, a change in fortunes from the meteoric growth witnessed during the pandemic.

Video game sales so far this year were flat and spending on video game content across platforms is down 2 per cent, according to analytics firm Circana.

Electronic Arts lowered its annual bookings forecast in January after it delayed the release of a game based on the Star Wars franchise.

Newly launched Hogwarts Legacy game from Warner Bros Discovery topped the videogame sales charts in February, according to Circana.