Kabam, the video game developer behind titles such as Marvel’s Contest of Champions and Disney Mirrorverse, has laid off 12% of its workforce as part of a restructuring effort, according to a statement obtained by Kotaku writer Ethan Gach. The layoffs affected various positions, including creatives, quality assurance, and live operations. This round of cuts follows a previous 7% layoff in November 2022. Other game developers like Offworld Industries are recruiting Kabam’s former employees for open job positions.
The year 2023 started as a heavy layoff year with redundancies reported not only in the gaming industry but also in tech companies such as Unity, Team17, and MTG-owned InnoGames. Many were attributed to restructuring, macroeconomic circumstances, and more.
According to the statement: “In light of current economics and the industry’s market realities, after reviewing our strategic priorities, Kabam has made the difficult decision to reduce its workforce by 12 percent. This restructuring provides greater financial flexibility to invest in new growth areas while also streamlining our existing development teams. We want to thank those leaving Kabam today for their contributions, and we are supporting them through this challenging transition.”
The Widespread Effects of Layoffs on the Gaming Industry
The gaming industry and the broader tech sector have seen significant layoffs and redundancies after experiencing accelerated growth due to remote work and home orders during the COVID-19 pandemic. In a bid to demonstrate financial prudence amid a possible recession (even hitting countries such as Germany), companies have implemented cost-cutting measures that involve reducing their workforce. These measures reflect a more encompassing post-pandemic slump that has affected mobile gaming companies. Some have also experienced localised issues, such as the Chinese gaming license freeze that has led to companies, including Tencent, making substantial investments in international ventures. Unfortunately, there is currently no end in sight for these redundancies.