On Wednesday, the video game company Electronic Arts announced cutting off a percentage of its workforce and reducing office space.
Its stock price went up by 0.99% to $119.19 per share on March 29. However, it is anticipated to drop by -0.08% to $119.10 apiece in the upcoming session.
According to the Securities and Exchange Commission, the firm expects to face impairment charges from $170.00 to $200.00 million. Also, it looks forward to the restructuring plan being completed by the end of September.
CEO Andrew Wilson said Electronic Arts would provide severance and health care for the affected staff. He noted that the layoffs already began earlier in the quarter.
Besides, the company only had almost 13,000 employees based on a quarterly filing on March 2022.
Additionally, the restructuring plan includes efforts led by portfolio rationalization. This meant dealing with property impairment charges, employment cuts that affect 6.00% of the labor force, and office space reductions.
Chief Financial Officer Christopher Suh mentioned that Electronic Arts would be conscious, focusing on the hiring pace.
The video game company joins the ongoing list of entities that are downsizing. Economic and market issues caused major layoffs, having rapid cuts this year. Furthermore, over 155,000 tech workers in more than 500 firms faced unemployment, as said by analysts.
Video Game Slump Stressed Electronic Arts
The video game giant Electronic Arts is famous for its yearly sports franchises like Madden NFL and FIFA. It will be renamed EA Sports FC as soon as its licensing agreement with soccer’s governing body expires.
Last year, the company found it challenging to publish a new hit. In January, EA closed its Pasadena studio Industrial Toys. This branch worked on a version of the shooter Battlefield.
Also, it shut down production of the mobile version of the famous shooting game Apex Legends. Moreover, the racing game from Electronic Arts called Need for Speed Unbound launched last year, only had small recognition.
Meanwhile, its anticipated hit is Star Wars Jedi: Survivor. However, it was delayed until April 28.
