EA Announces More Layoffs

Yesterday, when we reported on Free Radical’s closure, we wrapped up wondering just who was next on the chopping block. This morning, we got our answer, as Electronic Arts announced further details on a restructuring plan, which will include consolidating facilities and a new round of holiday layoffs.

According to the announcement, EA expects the restructuring plan to save it somewhere around $120 million annually and $60 million or so over the next several financial quarters. Under the new restructuring plan, EA will cut about 1,000 jobs, roughly 10 percent of its total worldwide workforce. The majority of these cuts are expected to be completed by March 31, 2009. The restructuring also calls for consolidation or closure of at least nine of the company’s studio and publishing locations, including the Vancouver-based Black Box Studio, which has been responsible for the company’s Need for Speed and Skate franchises. The Black Box teams and associated game franchises will move to the nearby EA studio location in Burnaby, British Columbia.

This new round of layoffs and consolidation comes at a rough time for EA. The company had already announced a round of upcoming layoffs back in October, now having to raise the number of jobs cut from the original 6 percent to the current 10 percent. While the current state of the world economy may be a major factor in EA’s current financial woes, many analysts have laid part of the blame on the company’s dogged pursuit of a Take-Two takeover earlier in the year. Black Box’s fate probably wasn’t helped by the lackluster reviews of Need for Speed Undercover either.