Amazon has laid off more than 100 employees across its gaming divisions, including Prime Gaming, Game Growth, and Amazon Games’ San Diego studio. In an internal memo shared by Bloomberg, gaming VP Christoph Hartmann announced that the layoffs were made to fit Amazon’s “strategic focus,” and that some employees would be reassigned to other projects. The teams in Irvine and Montreal, which are developing the online RPG New World and an unannounced project, respectively, will continue to grow. The company’s publishing efforts will also expand. Laid-off employees will receive severance pay, health benefits, and paid time to find new jobs.
Amazon has not provided any specific reasons for the layoffs, but Hartmann’s memo indicated that they were made after the company weighed its ongoing projects against its “long-term goals.” Amazon’s game development efforts have not been successful. The company is currently offering only New World, while its free-to-play shooter, Crucible, was only briefly available to the public and was shut down after just a few months. There has also been turmoil at the San Diego location, with John Smedley, a Sony Online Entertainment veteran who ran Amazon Games’ San Diego studio for six years, announcing his departure in January after a transition period.
The gaming layoffs come in the context of Amazon’s larger strategy to reduce costs company-wide, which includes plans to slash 9,000 positions, including some at its livestreaming service, Twitch. The company is dealing with a turbulent global economy and the effects of the pandemic recovery, and is looking for ways to streamline its operations. While the gaming layoffs represent a small piece of Amazon’s cost-cutting efforts, they signal a shift in the company’s priorities.
Despite the layoffs, Amazon’s game development efforts will continue, with the company expanding its publishing efforts and investing in its Irvine and Montreal teams. The company’s long-term goals remain unclear, but it seems that Amazon is looking to focus on projects that have a greater chance of success in the highly competitive gaming market.