Nintendo of America is restructuring its testing department ahead of the Switch 2 launch. Kotaku’s senior reporter Ethan Gach said over 100 contractor positions will be eliminated while some will be absorbed into the company as full-time employees.
It is not immediately clear the number of employees that will be laid off and the number that will be retained in the company. However, Nintendo said the restructuring will lead to the creation of a reasonable number of full-time employee positions. When reached out for comment by Kotaku, a spokesperson for Nintendo of America responded with the following statement.
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“Nintendo of America (NOA) has reorganized its Product Testing functions to drive greater global integration in game development efforts. The changes will also better align NOA with interregional testing procedures and operations.
“These changes will involve some contractor assignments ending, as well as the creation of a significant number of new full-time employee positions. For all assignments that are ending, the contractors’ agencies, with NOA’s support, will offer severance packages and provide assistance during their transition.
“For those contractor associates who will be leaving us, we are tremendously grateful for the important contributions they’ve made to our business, and we extend our heartfelt thanks for their hard work and service to Nintendo.”
Although the contractors are not directly employed by Nintendo of America but by an external agency, the company said it will offer severance packages to them.
Nintendo of America cut likely due to a “lull”
According to Gach, the decision to cut roles in Nintendo of America may be due to a waning first-party pipeline for the Switch. Citing the opinion of three contractors, Gach said the workload has almost ground to a halt and they don’t know anyone who is working on testing games for the Switch successor.
“While some current and former contractors tell me this downsizing comes amid a “lull” in testing for big first-party games and the reportedly delayed Switch 2,” Gach said, “Nintendo says it’s not a cost-cutting measure and the aim is to “drive greater global integration in game development efforts.””
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GameBaba Universe cited one person who made a post on LinkedIn about the layoff. Gameplay/AI programmer Carlos Garcia-Perez wrote, “As of today my assignment at Nintendo of America has come to an end”. He added, “I would like to thank both NOA and TEKsystems for the pleasure and experience I’ve received during my time there”.
Unlike other companies that have cut roles multiple times, this is the first time that Nintendo of America would be conducting large-scale layoffs. Also, the decision doesn’t appear to have impacted any full-time employee. Its competitors Sony and Microsoft have both made deep cuts to their workforce.
According to reports, the launch of the Switch successor has been pushed back to 2025. The previous anticipation was that it would arrive by the end of this year. However, it is claimed that the company pushed back the release to give it more time to support the new console with big first-party titles.
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The company used the same strategy during the launch of Nintendo Switch. Titles like Super Mario Odyssey, Mario Kart 8 Deluxe, and The Legend of Zelda: Breath of the Wild helped to push the Switch into the top-selling consoles in its first year.
Nintendo of America recently announced changes to its internal testing department, a move that will unfortunately result in layoffs for some employees. While this news may come as a shock to many, it's important to remember that restructuring is a common practice in the gaming…
— Oralle Evante (@EvanteOralle) March 28, 2024
It is not even the end of the first quarter of 2024 and the number of layoffs announced so far is nearly matching the entire layoffs last year. It is estimated that around 10,000 jobs were lost last year. However, with the current momentum, the job losses this year will likely exceed that number by a long shot.
