Amazon Games Hit by Layoffs, Will Halt AAA Growth

Amid sweeping layoffs that started all through ecommerce large Amazon Tuesday, the corporate is making “significant” adjustments to its video video games enterprise.

The transfer comes simply as Amazon had unveiled its revamped cloud-gaming platform Luna and outlined plans to proceed inside improvement on big-budget AAA titles (together with massively multiplayer on-line video games) alongside its new push for social gathering video games.

An undisclosed variety of cuts have been made within the Amazon Game Studios enterprise, as first reported by Bloomberg’s Jason Schrier and confirmed by Variety, as a part of the general elimination of 14,000 company employees at Amazon this week.

Amazon audio, Twitch and video games boss Steve Boom says that whereas the layoffs are taking place in reference to the general firm cuts, these reductions additionally point out a bigger technique shift inside the video games enterprise. Amazon’s online game studio is led by Christoph Hartmann, whereas Jeff Gattis is chief of Amazon Luna.

“Over the last several months, we’ve been evaluating our go-forward plans, specifically through the lens of our mission to deliver the very best gaming experiences to customers while leaning into the things that Amazon does best,” Boom wrote in a memo to employees Tuesday, which was obtained by Variety. “We believe that this is how we will have an impact with customers that fits the scale of Amazon. Last week’s launch of the all-new Luna is a great example, as it leans into both streaming entertainment and delivering value for Prime members, two tenets that are always top of mind in our group. Luna launched with a great catalog of social party games and AAA blockbusters, and we have a lot more to come from Jeff’s team on that front…it’s still Day 1.”

Boom added: “We’ve also taken a critical look at the evolving dynamics of games industry and competitive landscape. While we’re proud of our successes in first-party AAA game development and publishing, we have made the difficult decision to halt a significant amount of our first-party AAA game development work – specifically around MMOs – within Amazon Game Studios, including making significant role reductions in our studios in Irvine and San Diego, as well as our central publishing team.”

Last week, Amazon Luna relaunched (the cloud-gaming service first debuted in 2022) with a brand new lineup of premium third-party video games, together with “Hogwarts Legacy” and Xbox’s “Indiana Jones and the Great Circle,” and a UI replace, in addition to a celebration sport assortment labeled “GameNight.”

Earlier this month, Boom informed Variety that the overhaul of Luna didn’t sign a shift away from Amazon growing its personal AAA titles, however that it did point out plans to focus extra on “console-friendly titles, known IPs or known play patterns.”

“If you were to trace the arc of what we’ve released and what we’ve now announced from our games studio, it would actually point in this direction,” Boom stated. “So what started out in massively multiplayer games, MMOs, we’ve really widened the aperture, if you will. And so you’ve seen announcements for like things like ‘King of Meat,’ ‘Tomb Raider,’ our upcoming driving game, ‘Lord of the Rings,’ and kind of moving more in that direction of what I would call console-friendly titles, known IPs or known play patterns. The MMOs, those are really PC games. We launched ‘New World’ on consoles about a year ago, and it’s done really, really well, but those games at their core appeal to the hardest core-PC gamers.”

See beneath for Boom’s memo to employees in its entirety.

Dear Games Team,

This morning, we’re making a variety of adjustments in our Games enterprise. While you’ve possible seen Beth Galetti’s notice earlier this morning concerning the bigger adjustments at Amazon which can be going down right now, I needed to dive a bit deeper with all of you, because the strategic adjustments we’re making in Games transcend what is going on company-wide.

Over the final a number of months, we’ve been evaluating our go-forward plans, particularly via the lens of our mission to ship the perfect gaming experiences to prospects whereas leaning into the issues that Amazon does greatest. We imagine that that is how we are going to have an effect with prospects that matches the dimensions of Amazon. Last week’s launch of the all-new Luna is a good instance, because it leans into each streaming leisure and delivering worth for Prime members, two tenets which can be all the time prime of thoughts in our group. Luna launched with a fantastic catalog of social social gathering video games and AAA blockbusters, and now we have much more to return from Jeff’s group on that entrance…it’s nonetheless Day 1.

We’ve additionally taken a important take a look at the evolving dynamics of video games trade and aggressive panorama. While we’re pleased with our successes in first-party AAA sport improvement and publishing, now we have made the tough resolution to halt a major quantity of our first-party AAA sport improvement work – particularly round MMOs – inside Amazon Game Studios, together with making vital function reductions in our studios in Irvine and San Diego, in addition to our central publishing group.

While these adjustments are vital, we nonetheless have loads happening in sport improvement. Our Montreal studio just lately concluded a profitable closed alpha of March of Giants and is working exhausting to complete the sport. Our Studio 5 group simply launched Courtroom Chaos: Starring Snoop Dogg because the launch title in Luna and can proceed their concentrate on extra informal and AI-focused video games, optimized for Luna. Finally, we’re persevering with to work with our exterior studio companions Crystal Dynamics on an upcoming Tomb Raider title and Maverick Games on an upcoming open world driving sport.

Over the course of the day, each Christoph and Jeff will attain out with extra particulars on how these adjustments will have an effect on you and your groups. Most international locations with impacted workers have been notified. Our different international hubs will observe native processes and be notified at a later date.

There is not any getting round the truth that days like this are exhausting, and we will probably be shedding group members whose work and dedication have had an unimaginable affect on our prospects over time. We don’t make these selections evenly, and but they’re essential for us to proceed to drive our enterprise ahead.

Please attain out on to your supervisor or to your HRBP with any particular questions.

Thank you,

Steve