Pokemon Go creator, Niantic, is closing its Los Angeles studio and letting go of 230 employees which makes for around a quarter of its 1,000-plus workforce. Besides layoffs, some other organizational changes are also afoot at Niantic, including game shutdowns, according to an email from Niantic CEO John Hanke.
The changes have reportedly been put in place to streamline the company's focus on developing its biggest product, Pokemon Go, as it nears its seventh birthday. According to the 2022 Sensor Tower data, the game earns about $1 billion in revenue per year.
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Niantic Lays Off Some Staff To Focus On Pokemon Go
In his June 29 email, Hanke broke down some of the issues the company has been facing in the post-covid era:
"We have allowed our expenses to grow faster than revenue. 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, and new game projects and roles that support our products and our employees. Post Covid, our revenue returned to pre-Covid levels, and new projects in games and platforms have not delivered revenues commensurate with those investments,"
He went on to state that the mobile gaming market has matured and "only the best and most differentiated titles have a chance to succeed." Niantic is shifting focus to Mixed Reality devices and future Augmented Reality applications as well. Some other tech giants also haven't had much access with augmented reality games for phones. While Microsoft shut down Minecraft Earth, CD Projekt Red also officially shuttered its AR game in The Witcher series, this June.
Niantic is also shutting NBA All-World, which was often billed as Pokémon Go but with basketball and launched globally in January 2023. The company is also stopping production on Marvel: World of Heroes, which was scheduled to release this year.