Unity is currently undergoing a hard “reset” with dire consequences for some of its partners and workers. The video game software provider announced on Tuesday, November 28 that it will further trim its workforce by 265 employees which is about 3.8% of its global workforce.
The San Francisco-based company makes a software toolkit used by developers to make video games. Components of some popular games have been fleshed out using the Unity dev toolkit. From the beginning of the year, it was clear that Unity was facing some form of financial challenges.
Trouble intensified in September when Unity tried to change its “runtime fee” pricing policy. The policy change would charge new fees to game developers once they hit certain revenue and install thresholds. Developers revolted leading to a steep drop in the company’s share price.
The following month, Unity CEO John Riccitiello retired and former IBM president Jim Whitehurst was appointed as interim CEO and president while Roelof Botha was appointed as board chairman. Evidently, Unity wants to refocus its business.
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“While no additions have been finalized, it’s clear that we will reduce the number of things we are doing overall,” Whitehurst told Reuters.
The next round of layoffs announced on Tuesday is the third mass layoffs at Unity this year. In January, the company let go of 300 employees. That was followed by another 600 in May. The new layoffs bring the total job losses in Unity to over 1,100 this year alone.
Unity warned that there would be more layoffs in its recent financial results earlier in November. The company also disclosed that its current headcount is around 7,000.
Unity has terminated its deal with Weta FX
Following the reset, Unity has also announced that it was terminating its agreement with Weta FX owned by movie director Peter Jackson. Unity acquired the team that handled Weta Digital’s tools, pipeline, technology, and engineering back in 2021. The deal was worth $1.63 billion.
Weta FX (formerly Weta Digital) is a New Zealand-based digital visual effects and animation company. the company has worked on several high-grossing movies including Avatar, Lord of the Rings trilogy, and Avatar: The Way of Water. They are ranked among 21st century’s most influential movie companies. The company has won several BAFTA and Academy Awards.
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To achieve revolutionary visual effects, Weta has created proprietary software packages including MASSIVE and CityBot. The former was instrumental in creating large battle scenes for The Lord of the Rings trilogy. MASSIVE could animate many independent characters that acted based on pre-set rules.
According to Reuters, the 265 employees that would be made redundant are those whose roles were tied to the Weta FX deal. With the deal now terminated, Unity will have no need for the employees. However, the Weta FX deal is not the only thing getting shut.
Unity announced that it will be closing its offices in 14 locations across the globe. Two of the locations where offices will be closed are Berlin and Singapore. The company will also scale back its footprint in other branches including Bellevue, Washington, and its San Francisco headquarters.
The company will announce further closures in some countries after a consultation period with employees. Also, Unity will remove the mandate that required employees to work from offices three days a week and will scale down “full in-office services” to three days a week in most locations.
This year has been one of the toughest for video game workers. Wide-scale restructuring in the industry has seen thousands of roles made redundant. Studios like Volition Games and Campfire Cabal were shut by Embracer after a $2 billion Saudi deal fell through. Job security in the gaming industry is arguably at its lowest.
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