EA, the game maker in the midst of a big transition from the console era of gaming to the free-to-play world, confirmed widespread reports of layoffs today. The company did not disclose the size of the layoffs, but several other outlets are reporting either hundreds of layoffs or figures that are as high as 10 percent.
The downsizing, which comes on the heels of other layoffs in Montreal and Los Angeles earlier this year, is happening as EA is expected to have a weak earnings report on May 7. EA CEO John Riccitiello recently stepped down over “shortcomings” in the company’s financial performance for the most recent quarter after a six-year stint at the helm of the company.
We have an internal memo from executive chairman Larry Probst, which sheds light on some of the changes.
Core marketing functions, which were spread out between EA’s five different labels, are getting consolidated under COO Peter Moore. Origin, EA’s online distribution platform, is moving under EA’s President of Labels, Frank Gibeau, who is considered one of the few plausible internal candidates for taking EA’s helm once the CEO search is over.
As we begin the new fiscal year, I want to provide you with a brief update on some important changes to our organization. As Executive Chairman, my focus is to ensure EA is delivering high quality games and services to our consumers, while helping the executive team develop a FY14 operating plan that drives growth, rationalizes headcount and controls costs.
In recent weeks, the executive team has been tasked with evaluating every area of our business to establish a clear set of priorities, and a more efficient organizational structure. This process has led to some difficult decisions about the number of people and locations needed to achieve our goals.
The workforce reductions which we communicated in the last two weeks represent the majority of our planned personnel actions. We are extremely grateful for the contributions made by each of these individuals – they will be missed by their colleagues and friends at EA.
We are also taking action to streamline our organization, including changes in two key areas:
· Core marketing functions have been consolidated under our COO, Peter Moore. The combined group will bring together our Label marketing teams, Global Acquisition Marketing and Marketing Analytics into one multi-talented team under Todd Sitrin’s leadership. The development and marketing teams will continue to work as cohesive units, driving clear and consistent messaging and consumer engagement for each of our franchises.
· Origin will move into Frank Gibeau’s Labels organization. Andrew Wilson will take on the leadership of Origin, working with CJ Prober and the team to create more value and an enhanced entertainment experience for our consumers.
Change is sometimes difficult, but essential. The adjustments we are making will put us in the best position to build great games and services, deliver them more efficiently to consumers, and demonstrate to players around the world why they should spend their time with us.
EA is a great company, with talented and hard-working teams, a strong portfolio of products and an extremely bright future.
Thank you all for your dedication and commitment to our long term success!