Take-Two Interactive Software, the publisher behind blockbuster video game franchises like Grand Theft Auto and Red Dead Redemption, announced major layoffs and project cancellations this week as part of a cost-cutting plan. Approximately 5% of Take-Two’s workforce, around 600 employees, will lose their jobs. Additionally, several unannounced games that were in early stages of development have been scrapped entirely.
These moves from Take-Two and its subsidiaries like Rockstar Games come during a turbulent time for the video game industry. Even with high anticipation for the eventual release of Grand Theft Auto VI, many publishers have trimmed workforces and scaled back projects over the last two years.
No details were provided yet on which development projects Take-Two cancelled this week alongside the hundreds of job cuts.
Take-Two cited a need to “identify efficiencies” and improve profit margins behind its restructuring. But the $200 million in charges related to the layoffs and cancellations did little to boost investor confidence; Take-Two’s share price rose just 1% following the news.
Grand Theft Auto V originally launched in 2013 but has seen consistent success for Take-Two thanks to Rockstar’s ongoing development of GTA Online. That multiplayer environment within GTA V continues to be a financial boon for Take-Two. Red Dead Redemption 2 generated over $725 million within its first three days back in 2018, setting records for Take-Two.
Even with that level of profits, Take-Two is clearly concerned over looming recession worries and pulling back investment across its many studios. The video game sector saw record sales early in the pandemic but consumer spending has slowed substantially since then. Hiring across gaming also took off rapidly over the last five years, leading companies like Take-Two to have bloated payrolls in need of trimming.
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The $165 million in forecasted annual savings from reducing headcount could lead to better margins on Take-Two’s release slate. The publisher likely hopes to be in peak operating condition with optimal efficiency ahead of the hugely anticipated launch of Grand Theft Auto VI.
Expectations are massive for Grand Theft Auto VI to drive profits for Take-Two given the prolonged wait since Grand Theft Auto V first arrived. These layoffs and project cancellations parallel workforce reductions this year at other major gaming firms like Electronic Arts, Sony, and Tencent.
The entire video game industry faces rising costs and economic anxieties even with flagship brands like Grand Theft Auto, FIFA, and Call of Duty. Since the beginning of 2023, the video game industry has experienced over 16,000 layoffs, and 2024 has shown no signs of abating. This was as of early February. Hundreds more studio layoffs have since occurred, including those at Relic, Certain Affinity, Sega, EA, and other companies.
Take-Two’s move this week to cut 5% of staff shows that even leading publishers need to make difficult decisions in order to satisfy shareholders. Streamlining ahead of Grand Theft Auto VI’s eventual release allows Rockstar Games to focus resources on perfecting what will likely become the highest-grossing entertainment launch of all time.
What do you think of Take-Two’s Rapid Project Cancelation before GTA 6? Leave a comment and let us know.
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Hopefully the Games they canned were all Woke Dog 💩, nothing of Value was Lost.
Hopefully they took the deepest cuts out of localization, public relations, and diversity and inclusion segments.
D.I.E. professional on a curb begging: “Please. I am starving. can I have a dime?”
Me: kicks them in the face. “There. Now you can eat your tongue.”
Does anyone really think gta vi won’t be woke trash?
What games were cancelled can you find that out please? Bandai Namco did the same thing not long ago they cancelled games but didn’t say what. Take Two I assume is keeping GTA and Mafia so what did they cancel? BioShock? Sports games?