Electronic Arts today announced that it is laying off approximately 5% of its employees as it leans in on the parts of the business it feels will be the most successful in the years to come.
In its most recent annual report, the publisher gave its headcount as 13,400 as of the end of March 2023, which would put the job losses around 670 people.
The cuts are just one part of the company’s restructuring plan, which also includes closing some offices and sunsetting certain live games, like the previously announced shut down of MLB Tap Sports and F1 Mobile Racing.
In a note to staff, EA CEO Andrew Wilson said the company is also “moving away from development of future licensed IP that we do not believe will be successful in our changing industry.”
GamesIndustry.biz understands that one such title was cancelled as part of this plan, with the teams working on it redeployed to other projects.
Outside of sports or racing, EA’s major external licenses in recent years have included Disney properties like Star Wars and Marvel, which the company has tapped for upcoming games based on Black Panther and Iron Man. (An EA representative confirmed both Black Panther and Iron Man remain in development.)
Wilson explained the rationale for the shift away from licensed IP in his note, saying, “This greater focus allows us to drive creativity, accelerate innovation, and double down on our biggest opportunities — including our owned IP, sports, and massive online communities — to deliver the entertainment players want today and tomorrow.”
On the job cuts, Wilson said the publisher “deeply considered every option to try and limit impacts to our teams.”
He added that informing people of those impacts is a process that should be “largely completed by early next quarter.”
EA’s SEC filing detailing the restructuring plan indicates that it will cost the company between $125 million and $165 million. The office space reductions alone may be the biggest part of that, resulting in charges up to $65 million for the company.
Employee severance and related costs are expected to total between $40 million and $55 million, while there will be an additional $35 million to $45 million in “costs associated with licensor commitments.”
This is the second time in as many years EA has undergone a restructuring plan with hundreds of layoffs. Last March, the publisher announced a plan to cut approximately 6% of staff, or about 775 people going by the previous year’s global employee headcount.
