PlayStation Executive Defends Layoffs, Says They Were Necessary To Run A Business

It’s been tough times of late at Sony Interactive Entertainment, as the PlayStation company began the year by cutting 900+ jobs and cancelling games. In July, Sony axed a number of positions from its Destiny studio, Bungie, and announced a reorganization effort there. Then in August, Sony’s Firewalk team launched a multiplayer FPS called Concord, only to close it quickly and offer refunds, before the studio itself shut down for good after reportedly spending $200 million+ on it. In an interview with Variety, SIE co-CEO Hermen Hulst reacted to these dramatic moves, saying they all took place as part of the company’s effort to run a “sustainable business.”

“I will say a few things on that. It’s our duty to look at our our resource planning, and make sure that we run a sustainable business,” he said. “That’s part of being CEO. We never take that lightly, because we know these people personally, and it’s very close to our hearts and the teams and good working atmospheres. But yes, we’ve had some layoffs.”

Hulst went on to say that the PlayStation Studios division is actually “much greater” today in terms of employment numbers than it was five years ago. “It’s grown tremendously. And that is organic growth that our existing teams, I think, hired quite aggressively, as well as through [mergers and acquisitions],” he said.

Hulst’s defense of Sony’s major cuts sounds similar to what Microsoft Gaming CEO Phil Spencer said about Xbox’s own dramatic business shifts that included 2,500+ layoffs in the past year and numerous studio closures. In March, Spencer said the initial round of job cuts announced in January was necessary to help Xbox become a profitable business following the blockbuster buyout of Activision Blizzard.

2024, like 2023 before it, has been a brutal for layoffs in the video game developers and staff at Sony, Microsoft, Ubisoft, and many other companies. Some estimates suggest there have been more than 11,000 layoffs in the video game sector in 2024 alone.

A former PlayStation executive recently shared his thoughts on the cuts, claiming they are not due to corporate greed alone, but are instead part of general macroeconomic conditions. This executive, Chris Deering, was roundly criticized for saying people who have been laid off can just “go to the beach for a year.”

A labor union, the Communication Workers of America (CWA), recently criticized Sony’s decision to close Firewalk and shut down Concord, lamenting the kinds of decisions made by “highly insulated video game CEOs.”