Riot Games rolls out the red carpet for 530 layoffs (11% of workforce)

Riot Games announced their intent to cut ~one-tenth (11%) of their workforce effective immediately. Two public statements by CEO, Dylan Jadeja were posted on the Riot Games website; first, a public PR statement, followed by the internal email sent to Rioters.

Both statements aim to reflect the reasons for the mass layoffs, and how sorry Riot Games is for making the decision. They also reflect how much the company tries to minimize the blow of these layoffs on individuals, but also on their PR image.

Looking at the staffers that posted on socials, most impacted were the creatives and “non-core product” members.

Credit: Riot Games

This follows a similar trend to other series of mass layoffs in both the tech and game dev sector over the past few months. The long-winded release showcases Riot wants the public to know about the severance packages, terms, conditions and all the efforts put into keeping the process as “pain-free” as possible given the circumstance.

Riot Games to Focus on High-Impact Projects
The stated goal in both statements is to move to a “more sustainable future” by pooling their resources into high-impact projects. A total of 530 employees have been affected by the layoffs, representing more or less 11% out the company’s workforce.

The statement starts with a blunt reality some people will be facing:

Today, I’m sharing a decision we hoped we would never have to make at Riot. We’re changing some of the bets we’ve made and shifting how we work across the company to create focus and move us toward a more sustainable future. This decision means we’re eliminating about 530 roles globally, which represents around 11% of our workforce, with the biggest impact to teams outside of core development. This also sadly means we’ll be saying goodbye to many talented colleagues and friends across all areas of Riot.

It goes on to illustrate a hiring boom and an expansive portfolio that is not showcasing the intended returns to numbers crunchers and spreadsheet warriors. The bulk of staff laid off comes mostly from creative projects and lore building pushes.

Riot Forge is going to be completely scrapped, while Legends of Runeterra will mostly focus on the PvE aspects of the game.

League of Legends, Valorant, TFT and Wild Rift are not as impacted in their core operations, but some creatives and esports personnel were impacted.

Project L and Project F seem to also be still on track in some capacity, but we cannot asses how many positions were lost from those teams.

Rolling out the PR nugget and internal email publicly
The entire internal email, although stated as a transparency push, also gives insight in how Riot Games wants to showcase they are not just cutting labor and costs, but also care about how the affected employees transition moving forward.

Both email and public statement makes similar repetitive quotes as the one below:

For those who are leaving… I want to reiterate, we are deeply sorry for the impact this has on you and your family. I can’t thank you enough for everything you’ve done for Riot, and for your dedication to players. We’re committed to doing our best to support you in this moment and through this transition.

The long list of “benefits” for those affected include:

Severance Pay — 6 months of salary,
Cash Bonus — Equal to their yearly APB targets.
Retaining Health Benefits, Play Fund, Wellness Fund for a the severance period.
Career Support & Visa Support for the transitional period.
Retaining acess to the Company Laptop, Rioter Assistance Program and Riot Email Access

To be honest, the way Riot Games aims to handle this for all parties involved is actually commendable. They publicly set a standard of how layoffs should be handled, by setting up a fall suite of support and severance options to assist those leaving the company.

On the other hand, it is a bit on the nose they push all this information publicly with capital and bold letters and showcase to everyone how much they care, and repeat that this is not about the money or quarterly earnings.

Credit: Riot Games

Why this is happening and the path forward
The reasons why this is happening are multifaceted, and I might need to run a MANOVA just to illustrate all the variables.

Almost everything plays a factor in how the tech, game and adjacent industries over-reacted this past quarter. AI paranoia, legislation like Section 174, time-bound expected ROI on initiatives, and steep KPIs on creative work have all played a part in companies prioritizing guaranteed returns and lowering costs over new long development projects. Niche and limited audience products are also de-prioritized.

Riot Games similarly reflected this. The core live games – League of Legends, VALORANT, Teamfight Tactics, and Wild Rift are going to get the most love. They all have an established market, direct monetization and almost guaranteed returns. Project L is already deep enough in development to be seen through, and entertainment products like Arcane are guaranteed winners as well.

Mainly, Riot will stick to what they know works and try elevate or maintain it.

There is a beneficial caveat for us consumers. Looking long-term, we now have a big number of game dev, tech professionals and creatives in the open market.

We may get a small renaissance of unique content and fresh takes in plenty video game genres. Seeing how, Palworld, Only Up!, Among Us re-scaled the markets with booming early-releases, we now have the talent and potentially the time and space for new and unique worlds to be shared with us.

The game industry winter may be a curse for big developers, but for us consumers it may be a blessing as all these creatives tackle new and exciting projects to deliver to us.

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