Niantic, the creator of the Pokémon Go mobile video game, revealed that it will be laying off 230 of its employees and is set to make changes to the company following economic difficulties. In addition, Niantic will also close its studio in Los Angeles and announced it will also cancel two games.
Niantic CEO, John Hanke, confirmed the unfortunate news for the employees in a letter that announced the reduction of the business’ workforce. He also corroborated the shuttering of the company’s studio in Los Angeles and canceled the launching of NBA All-World and Marvel: World of Heroes.
Regarding the reasons, Hanke stated that the company increased quickly during the great demand for digital service in the early stages of the COVID-19 pandemic. Moreover, the Pokémon Go video game was one of the very first video games to use augmented reality in 2016 and brought millions of people together to catch them all.
However, times have now changed Hanke stated that, after pursuing growth and expanding Niantic’s business, the new projects they have released did not deliver the expected revenues and for that reading the cut will be made. He stated:
“In the wake of the revenue surge we saw during Covid, we grew our headcount and related expenses in order to pursue growth more aggressively, expanding existing game teams, our AR platform work, new game projects and roles that support our products and our employees. Our revenue returned to pre-Covid levels and new projects in games and platforms have not delivered revenues commensurate with those investments”
In spite of the discouraging declaration, he also stated that Niantic’s top priority is to maintain Pokémon Go healthy and “growing as a forever game.” He later added that employees should expect a “more result-based” approach moving forward.