Massive video game layoffs rock industry after Microsoft's Activision Blizzard acquisition 

More than 6,000 game industry workers have lost their jobs so far in 2024, continuing a dismal trend from last year. Many of these layoffs hit Activision Blizzard, the giant behind blockbusters like Diablo 4, even as new owner Microsoft got a revenue boost after acquiring it.

“The industry is always volatile,” says Bloomberg’s Jason Schreier, games reporter and author of “Blood, Sweat, and Pixels,” “Press Reset,” and the upcoming “Play Nice: the Rise, Fall, and Future of Blizzard Entertainment.”

But rising interest rates and changing consumer habits led to particularly deep staff cuts.

“During the pandemic, game companies saw their revenues go through the roof as people were stuck at home playing games,” says Schreier. “A lot of those companies saw money coming in and thought it would last forever and expanded accordingly. When the pandemic abetted and people returned to their normal lives and slowed down on game spending, those companies suddenly found that they were too big and had gotten there too fast.”

The layoffs at Blizzard Entertainment also came after the company started clamping down on remote work, leaving relocated ex-employees stranded in expensive cities like Irvine, California.

“They’re stuck someplace where their rent is a lot higher than it might be if they were living somewhere else and working remotely,” explains Schreier.

Recent job losses seem to have convinced more workers to rally behind a burgeoning labor movement and the protections unions could bring. For consumers, the industry turmoil means that some long-awaited titles won’t ever see the light of day. So even as games are earning hundreds of billions and increasing cultural capital each year, the medium’s forecast remains cloudy.

James Perkins Mastromarino and produced and edited this interview for broadcast with Todd Mundt. Perkins Mastromarino adapted it for the web.