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Electronic Arts Says It Is Laying Off 6% of Workforce

Electronic Arts Inc.

EA 0.99%

said it is laying off about 6% of its workforce and reducing its office-space footprint to focus its spending on the best growth opportunities in the videogame industry.

The maker of hit franchises such as “Madden NFL” and “The Sims” didn’t specify how many people would be let go or from which departments. In the middle of last year, it said it had nearly 13,000 employees. That would translate into around 780 job cuts. The company said it plans to redeploy some of the affected staff to other areas.

EA said the layoffs began earlier this quarter and are expected to continue through the early part of its next fiscal year which begins in April. The Redwood City, Calif.-based company also said it is trimming its real-estate spending and restructuring some teams.

“Now, more than ever, we must be focused on our strategic priorities,” EA’s Chief Executive

Andrew Wilson

said Wednesday in a statement prepared for a blog post for employees. “These priorities align our investments with opportunities to make the biggest impact.”

The announcement makes EA the first major videogame publisher to disclose significant layoffs. The industry has until now been largely sheltered from the staff reductions that have been happening at many tech companies, including

Amazon.com Inc.,

Microsoft Corp.

and Facebook parent

Meta Platforms Inc.

The technology leaders have blamed the layoffs on everything from slowdowns in demand and advertising to the need to pare back teams after over-hiring in recent years.

Illustration: Adele Morgan

In February, EA’s shares fell about 12% after it reported a rare miss on guidance for its fiscal third quarter and plans to cancel two mobile games. At the time, Mr. Wilson said the company was “taking strategic actions to evaluate our cost structure as we navigate through the current macro environment.”

The videogame industry has had a challenging start to the new year after a slowdown in player spending that reversed some of the outsize growth made during the pandemic. Other big publishers, including

Ubisoft Entertainment SA


Take-Two Interactive Software Inc.,

have recently made strategic changes as well.

In a securities filing, EA said it estimates that it will incur approximately $170 million to $200 million in charges in connection with the layoffs and other restructuring measures, which it expects to be mostly complete by the end of September.

Shares of EA have fallen about 3% so far this year. The Nasdaq Composite Index fell close to 14% over the same period.

Write to Sarah E. Needleman at [email protected]

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