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News GTA publisher Take-Two joins the flood of gaming layoffs — which could be felt for years

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We got 19K layoffs before GTA 6… Gamers have been waiting 11 years for the next “Grand Theft Auto,” but there’s no joyriding in the industry right now. Take-Two, GTA’s publisher, last week announced plans to lay off 5% of its workforce (~600 people) and scrap several projects in development. Take-Two said the move’s meant to boost profit margins, adding to a flurry of layoffs that’ve been KO’ing the industry. By some estimates, since last year, nearly 20K workers have been let go from video-game giants like Microsoft, Sony, EA, and Epic.
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Source: https://sherwood.news/snacks/busine...y Nasdaq&utm_term=Snacks Weekly 10M 22APR2024
 
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Take-Two said the move’s meant to boost profit margins
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I just can't get over how shooting-yourself-in-the-foot shortsighted seemingly every major company is

"yes we burned a ton of people with experience and institutional knowledge and that will affect the quality of our games well into the future as those people decide to leave the industry despite us already making record profits, but we fudged some numbers and made it look like we had slightly better growth for one quarter"
 
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19 THOUSAND layoffs? The year before they're going to have record-breaking profits due to GTA 6?

There's a special level of hell just for such people.

E: Oh, misunderstanding, 600 people. Still, the upper sentence applies.
 
BlackthornOrion said:
I just can't get over how shooting-yourself-in-the-foot shortsighted seemingly every major company is
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It's basically become a game of chicken for the top-level execs, each one trying to boost their profit margins as much as possible, reaping the bonuses and fervently hoping that when the whole thing explodes it'll be at the next guy's face.

It's sickening how they can shamelessly say they're firing people "to boost profit margins". Not even because they're losing money, but because they want to make their numbers look a little prettier. Well FUCK your numbers.
 
Take Two is a special kind of capitalist hell. They budget for and forecast for the notion that GTA will release and make a hojillion dollars after developing a game for a decade with turbo crunch conditions.

If one of these major Rockstar releases were to ever sell even slightly less than a hojillion, I'd hate to imagine the size of the layoffs in response.
 
meatbag said:
It's sickening how they can shamelessly say they're firing people "to boost profit margins". Not even because they're losing money, but because they want to make their numbers look a little prettier. Well FUCK your numbers.
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That's the profit driven market for ya. In a perfect capitalist society, us, the consumers should be sitting on the top of the pyramid, not the shareholders. A bitter reminder that the thing they call capitalism today is nothing but feudalism in disguise.
 
I'm sure they are going through a rough financial situation and this has nothing to do with simply increasing stockholders' already astronomical profits, right?
 
BlackthornOrion said:
I just can't get over how shooting-yourself-in-the-foot shortsighted seemingly every major company is

"yes we burned a ton of people with experience and institutional knowledge and that will affect the quality of our games well into the future as those people decide to leave the industry despite us already making record profits, but we fudged some numbers and made it look like we had slightly better growth for one quarter"
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Current corporate structure incentivizes executives to prioritize short term gains for the sake of exhorbitant productivity bonuses


Bonejack said:
19 THOUSAND layoffs? The year before they're going to have record-breaking profits due to GTA 6?

There's a special level of hell just for such people.

E: Oh, misunderstanding, 600 people. Still, the upper sentence applies.
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Yeah, it’s surprising how an industry has shed 20,000 workers, especially an industry with, even though ballooning costs, they’re still profitable.


Hailinel said:
Take Two is a special kind of capitalist hell. They budget for and forecast for the notion that GTA will release and make a hojillion dollars after developing a game for a decade with turbo crunch conditions.

If one of these major Rockstar releases were to ever sell even slightly less than a hojillion, I'd hate to imagine the size of the layoffs in response.
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Or instead of making 5% profit, they make 3.5% and still make layoffs


9-Volt said:
That's the profit driven market for ya. In a perfect capitalist society, us, the consumers should be sitting on the top of the pyramid, not the shareholders. A bitter reminder that the thing they call capitalism today is nothing but feudalism in disguise.
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Word. Unrestricted Capitalism turns into neo-feudalism/Corporate Welfare. They subsidize their productivity bonuses at the cost of overpricing and laying off
 
It's exhausting how this is like the 12th example in recent memory of this type of layoff. This will definitely have a noticeable effect on game development during the rest of this decade.
 
meatbag said:
...each one trying to boost their profit margins as much as possible...
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9-Volt said:
That's the profit driven market for ya.
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It would be bad enough if this was the case, but actually, there's little-to-no evidence layoffs improve profitability. Short-term, they're expensive; you have severance to pay and you need to restructure teams. Long-term, it shouldn't be surprising that removing a decent chunk of your workforce lowers your productivity which ultimately has a knock-on effect on your revenue.

These extremely highly paid executives are making these awful, life-shattering decisions based on high-school-economics-student-level logic: "lower costs = higher profit". And the shareholders lap it up, because shareholders are also typically quite short-sighted and stupid, so the share price often responds positively which then validates the decision. It's fucking ridiculous.
 
Preparing for the 1 quintillion bags of money they're going to receive next Spring lol Might as well only have one employee to M A X I M I Z E the earnings.
 
hologram said:
It would be bad enough if this was the case, but actually, there's little-to-no evidence layoffs improve profitability. Short-term, they're expensive; you have severance to pay and you need to restructure teams. Long-term, it shouldn't be surprising that removing a decent chunk of your workforce lowers your productivity which ultimately has a knock-on effect on your revenue.

These extremely highly paid executives are making these awful, life-shattering decisions based on high-school-economics-student-level logic: "lower costs = higher profit". And the shareholders lap it up, because shareholders are also typically quite short-sighted and stupid, so the share price often responds positively which then validates the decision. It's fucking ridiculous.
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A lot of executives aren't committed to benefited the company's they work for in the long term. They're there to make as much money as possible until people catch on that they are doing a shitty job. But until that happens, execs squeeze as much as they can to make that profit or revenue go up just a little bit year over year, consequences down the road be damned.
 
HockeyBird said:
A lot of executives aren't committed to benefited the company's they work for in the long term. They're there to make as much money as possible until people catch on that they are doing a shitty job. But until that happens, execs squeeze as much as they can to make that profit or revenue go up just a little bit year over year, consequences down the road be damned.
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In Strauss Zelnick's case, yeah, he is the "let's make some craaazy money" type of CEO. He himself is an investor in other non-gaming related fields, truly a profit driven executive. He's one of those who can "smell the money". Dude has found a way to bring astronomical levels of annual income without making a big game, thanks to GTA Online microtransactions. He's the sole reason why Take Two remains dedicated to scummy mtx practices more than anyone in the gaming industry today. Take Two acquired Zynga just to boost that.

This is his 17th year on top of the Take Two empire, doesn't seem like he's going away anytime soon, with that money the company generates. Shareholders love the guy.
 
it should be a serious crime for a profitable company to layoff large amounts of people to juice numbers.

Life in prison for the CEO. Dead serious.
 
I mean I think they were the ones that created the horrible run for the number one spot on most expensive game of all time when they released GTA V, so who would've thought they'd just do mass layoffs just the year before VI comes out after being crunched like hell and they can layoff even more people after it's out because well the game got a 98 MC and made 4 billion dollars in 3 days so Rockstar is the best company ever right?
 
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Pillydillsy said:
That bubble sure is looking mighty big right now….
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I don't think gaming is in a bubble, just in a rot fermented by scummy executives. I don't think this particular market will regulate itself unless video game company employees unionize
 
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hologram said:
It would be bad enough if this was the case, but actually, there's little-to-no evidence layoffs improve profitability.
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I've wondered about that too, because in all the companies I have worked for, any kind of mass layoff has always, always resulted in the company having to spend even more in trying to hire new people.

So yeah these execs are implementing these soulless "strategies" that aren't even proven to work. It's maddening.
 
Ah, yes. The time-honored tradition of cutting swathes of your workforce in order to raise short-term profits whilst gutting your potential to generate profit in the medium- and long-term. Just kick the can down the road to appease shareholders while fucking over your actual output and employees' lives.
 
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