US video game giant Take-Two Interactive Software Inc. is set to conduct a new round of job cuts and call off a few projects as part of its push to trim costs amid uncertainty over consumer spending in games following a pandemic-driven boom.
The Rockstar Games Inc. parent stated it will lay off 5% or around 600 of its personnel by the end of 2024. The company is also dropping some in-development projects, which it chose not to specify.
The owner of the “Grand Theft Auto” (GTA) franchise expects the two moves to result in $160 million to $200 million in expenses, with the scrapped projects costing as much as $140 million and severance staff-related costs accounting for up to $35 million.
Take-Two estimates an annual savings of over $165 million from the plan. It also intends to cut office space as part of the cost-reduction drive.
Video Game Spending Uncertainty to Continue
The New York-based gaming company is the latest major video game publisher to announce significant layoffs this year, following similar recent moves from Riot Games Inc., Electronic Arts Inc., and Sony Interactive Entertainment LLC as the easing pandemic boom led to weaker video game spending.
A gaming industry research firm said computer and console gaming revenue will likely stay below pre-pandemic levels through 2026 as players spend less time gaming.
The lack of new hardware, successful titles, and inflation have weighed on video game sales this year.
While new titles, including “Helldivers 2” and “Palworld”, have gained significant traction, the industry’s near-term outlook remains uncertain.
The coming months have yet to present interesting titles or offers, while most highly-awaited hardware, such as the Nintendo Switch 2, and software are set to be released next year.
Take-Two is currently working on the development of “GTA VI”, although the planned 2025 release of the latest installment in the popular franchise might reportedly be delayed into 2026.
