EA Confirms 10% Staff Reductions During Investor Call
Electronic Arts has officially confirmed rumors which have been widely circulated for over week: 10 percent of the publisher’s workforce was let go during last week’s massive layoffs. The news came as part of an otherwise upbeat earnings report, serving as an important contrast between the riches reaped by major developers and the all-too-expendable workers who help make those riches possible,
The confirmation of number of employees made redundant was slipped into today’s quarterly earnings report investor call, during a discussion of first quarter expenses. EA confirmed it has paid out approximately $25 million in severance payments as a result of these layoffs. The specific divisions affected by the restructuring were not named, but rumors last week consistently mentioned employees at EA’s Galway, Ireland call center and EA India, as well as Popcap, EA Partners and Quicklime Games.
During the call it was suggested (though not stated outright) that the restructuring was part of Electronic Arts’ efforts to acquire the exclusive license to produce Star Wars games from Disney, a deal finalized and announced yesterday. If so, it calls attention to the expense of acquiring the Star Wars licenses. EA has not disclosed how much it has pledged to disney, either up front of through residuals, for the rights to make new Star Wars IP, but presumably the expense must be huge to warrant the elimination of 900 positions within the company (based on the company’s approximately 9,000 employees in 2012).