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Sony lays off 900 workers from PlayStation division amid video game slump

Sony Interactive Entertainment on Tuesday said the company will cut about 900 jobs at its PlayStation unit and shut a studio in London as the videogame industry struggles to recover from a post-pandemic slump.

The layoffs will affect about 8% of the division’s staff in regions from the Americas to Asia and come days after Sony slashed the annual sales expectation for its PlayStation 5 console.

“After careful consideration and many leadership discussions over several months, it has become clear changes need to be made to continue to grow the business and develop the company,” departing Sony Interactive Entertainment President and Chief Executive Officer Jim Ryan wrote in an email to employees.

Sony Interactive Entertainment said Tuesday that it’s laying off some 900 employees in its PlayStation unit, and has proposed to shutter the video game maker’s entire London division. SOPA Images/LightRocket via Getty Images

Sony said the layoffs will impact several PlayStation Studios, including the game makers at Insomniac, the studio behind “Spider-Man;” Naughty Dog, which makes “The Last of Us”; and Guerrilla, the studio behind “Horizon,” Bloomberg earlier reported.

The studios are three of Sony’s most successful subsidiaries, according to Bloomberg.

All US staffers affected by the headcount reduction will be notified on Tuesday, but the Japanese firm has yet to decide whether workers in the UK will also be handed pink slips.

Representatives for Sony did not immediately respond to The Post’s request for comment.

Sony CEO Jim Ryan announced the news in a memo sent to staffers on Tuesday. Ryan is set to retire from Sony in March. AFP via Getty Images

The global videogame market grew just 0.6% last year to $184 billion, according to industry tracker Newzoo, though that was better than a decline of more than 5% in 2022.

Other video game-makers have also been axing staffers, including Microsoft, which said last month that around 1,900 employees in its gaming division would be laid off — just weeks after completing its $69 billion acquisition of “Call of Duty” maker Activision Blizzard.

Phil Spencer, the CEO of Microsoft Gaming, circulated a memo to employees notifying them that the layoffs amount to around 8% of the tech behemoth’s gaming division and will affect staffers at Xbox and ZeniMax as well as Activision Blizzard.

The layoffs account for 8% of Sony’s global workforce. NurPhoto via Getty Images

Spencer wrote in his memo that he and his team have “identified areas of overlap” since the software giant absorbed Activision Blizzard and its approximately 13,000 employees last year.

Mike Ybarra, president of Blizzard Entertainment, and Allen Adham, the chief design officer of Activision, are also departing as part of the restructuring.

More than one-third of video game developers were impacted by layoffs in 2023 according to Wired, citing data from the Game Developers Conference — a year when the tech sector shed a total of 168,032 jobs, accounting for the highest number of layoffs across industries.

Those affected workers included the 830 staffers that were lais off from “Fortnite” franchise maker Epic Games in September, as well as the 180 workers in Amazon’s games unit that were cut in November.

This story originally appeared on NYPost

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