Unity to cut around a quarter of its workforce

Massive restructuring at the game engine maker

Unity, maker of the game engine of the same name, has revealed its intentions to lay off around a quarter of its workforce in a new round of job cuts, according to Reuters. This could affect up to 1,800 people across all departments and regions. The market reacted positively to the news, seeing Unity’s stock value rise by 5%.

In November 2023, Unity already cut around 4% of its workforce and closed 14 offices with the interim CEO Jim Whitehurst, who’s leading the company for the time being after former CEO John Riccitiello retired, stating that more cost cutting measures were to come. These latest layoffs are the largest in Unity’s history and it’s the fourth round of job eliminations since July 2022 at the company.

Unity's fall from grace in 2023 has been swift and spectacular / Unity

According to Reuters, Whitehurst stated in an internal memo on January 8, 2024: “We are … reducing the number of things we are doing in order to focus on our core business and drive our long-term success and profitability.”

Unity was widely regarded as having expanded too widely too quickly in the previous years, which among other things led to a massive workforce. Between 2020 and 2022, Unity went on an acquisition spree that saw it take over the desktop streaming service Parsec, VFX company Ziva Dynamics, monetization technology developer ironSource, and Weta Digital, the technology and engineering arm of Peter Jackson’s Weta FX.

Earlier in 2023, Unity tried to implement a new pricing scheme for its game engine, which led to many game developers protesting and either leaving the engine behind in favor of a competitor or announcing their intention of doing so. Unity eventually backtracked, implementing a new pricing policy that’s less disastrous. Ultimately, the entire affair led to developers’ trust in the company being shattered, which is expected to have lasting negative effects on the business.