The wave of layoffs in the video game industry does not stop. After a 2023 in which a large number of studios and distributors were affected by staff cuts, the trend continues in 2024. This time it was the turn of Riot Gamesthe creators of Valorant and League of Legendswhich announced the departure of hundreds of employees.
The company, a subsidiary of Chinese giant Tencent, reported an 11% reduction in its global workforce. This translates into the dismissal of 530 workersexplained Riot Games in a statement signed by Dylan Jadeja, its CEO.
According to the executive, the studio has lost focus and this is largely due to the fact that they have too many projects underway. Jadeja explained that the number of Riot Games employees doubled from 2019 to date and that some of the bets that were made in recent years did not provide the desired results.
The firm has confirmed that the layoffs will have a major impact outside the core dedicated to video game development. This means that equipment intended for Valorant, League of Legends, League of Legends: Wild Rift and Teamfight Tactics They will continue working almost normally.
However, that will not be the case Legends of Runeterra. The digital trading card title will see a reduction in the number of developers dedicated to the project. While the game itself will mutate to focus on the player versus environment (PvE) mode called Path of Champions. The leader of Riot Games indicated that the decision indicates that this proposal becomes economically sustainablesince, although it enjoys good popularity, the studio can no longer continue subsidizing it.
Riot Games joins the wave of layoffs in the video game industry
The other big change that the creators of Valorant and League of Legends be the closure of Riot Forge, your distributor for third-party titles. This will happen after the release of Bandle Tale: A League of Legends Story, which has a confirmed date for next February 21. The game created by Lazy Bear Games for PC and Nintendo Switch will be the last proposal to hit the market with this publisher.
Dylan Jadeja maintained that they are not closing the door on him working again with other studios in the future, but that if this happens it will be under a different modality. Furthermore, he asserted that They tried to avoid layoffs as much as they couldbut that the cuts and other changes applied internally were not enough to ensure the economic viability of the company.
“Some of the significant investments we have made are not paying off. Our costs have increased to the point of being unsustainable and we have run out of room for experimentation or failure, which is vital for a creative company like ours. All of this puts the core of our business at risk. […]
We are not doing this [los despidos] to appease shareholders or to hit some quarterly profit figure; We make this decision because it is necessary. “It’s what we have to do to maintain a long-term focus for the players.”
Dylan Jadeja, CEO of Riot Games.
A very complex 2024 is expected for the sector
The new layoffs from Riot Games follow a trend in the video game industry. Many studios expanded their teams at a rapid pace during the pandemic, when demand for home entertainment reached sky-high levels. However, the normalization of global activities has led to many companies having to make cuts. In this case, not even the popularity of Valorant either Lol have been enough to avoid the unfortunate outcome.
In 2023 we have seen layoffs at Epic Games, Blizzard, Electronic Arts, CD Projekt RED, Unity, and even Bethesda and Xbox. Of course, these have been just some of the most notable cases. More than 10,000 workers lost their jobs during the last year, while around 3,000 have already suffered the same in the current calendar. And the prospects for the coming months are not good.
Regardless of what happens now with Riot Games, it was learned yesterday that in 2024 there will not only be more layoffs, but many video game studios will also close. According to industry executives, this is because Their business models are not profitable and they will become impossible to sustain. If this really happens, it is expected to also impact related areas such as marketing and content distribution.