Confirmed: EA guts Pandemic

 Update: A Shacknews report confirms that EA has cut a large potion of the workforce at Pandemic, but says that it  is not getting rid of the studio, - it is  consolidating it into a “core team” and moving it to EALA. Here’s what EA said officially:

“Pandemic Studios and its franchises will be relocated to the EALA facility in nearby Playa Vista,” a rep for the company told Shacknews. “This move has resulted in a reduction in the work force at Pandemic…That said, the Pandemic brand and franchises will continue to live on. A core team of Pandemic developers will move to EALA and continue development on Pandemic games with a focus on quality, cost management and schedule integrity.”

Original Story: Is the other shoe about to drop for Panedemic’s L.A. studio? According to this Kotaku report, citing reliable sources close to the situation, EA will lay off most of Pandemic’s Los Angeles studio at 11 AM PST. The Saboteur, the current project being developed by Pandemic will  be shifted to Army of Two developer EA Montreal - also according to the Kotaku report.

Pandemic’s Brisbane studio, which was developing a game adaption of the latest Batman film, The Dark Knight, was cut loose from the EA family in January of this year. Pandemic is best known for developing such franchises as Full Spectrum Warrior, Mercenaries, Star Wars: Battlefront and Destroy All Humans.

If this rumor is true it means that most of the 200 people that work at Pandemic L.A. will be out of work right before the holidays, which is absolutly horrible, but a typical move by corporations in the fourth quarter. Earlier in the month EA laid off a large number of employees from its Maxis studio. No doubt EA will be making cuts across the board as it tries to hit the restructuring number of 1500 before the next fiscal quarter in March 2010.

We’ll have more on this story as it develops and hopefully an official confirmation or denial from EA soon.

51 employees laid off at EA’s Tiburon studio

According to a report in the Orlando Sentinel 51 employees have been laid off at EA’s Tiburon studio in Maitland, Florida.

This answers a question I posed earlier today about the timing of a EA’s restructuring plan to lay off 1500 employees from its global workforce. I guess that means the timing for it is immediate.

According to the report, about 600 employees work at the studio behind Madden NFL, the Tiger Woods titles, the upcoming MMA game, and the NCAA Football series.

“The game industry is in a period of rapid change, and the pace of that change is accelerating,” Tiburon General Manager Philip Holt wrote in an e-mail to employees. “In order to control our own destiny and succeed in this rapidly changing environment, EA is taking bold action on costs so we can win in the future. We are not exempt from these cost actions here in Orlando and, subsequently, 51 of our colleagues will be leaving Tiburon.”

The email obtained by the Sentinel went on to say that the studio “would focus on products with the greatest potential, continue the shift toward selling games through downloads or online play instead of retail outlets, and look for more ways to cut costs.”

Of course a lot of that is nonsense. Obviously EA has never had a problem selling any of the games that Tiburon makes. The truth is that no studio is safe from at least some minor cuts as EA figures out how to hit that magic 1500 number by the end of March 2010. EA also thinks that mobile devices and social networks are an important part of its future, but that doesn’t mean the company is giving up on traditional console gaming.

Florida lawmakers and business development types, particularly local to the Tiburon studio are concerned by these cuts for the obvious reasons, but also worry that EA might move the studio to a state or region that has more favorable tax incentives and lower business costs. Suzy Spang, vice president of technology and entertainment for the Metro Orlando Economic Development Commission (a group dedicated to enticing business to open up shop and stay in Orlando)thinks this could be a problem in the not-too-distant future:

“I know EA is committed to Orlando, and they are invested here, but I have to pause and wonder if Florida is the most economical place for them to do business when other states are aggressively pursuing this industry sector,” Spang told the paper.

We’ll continue to follow this story as it develops. Expect to hear about more layoffs in the days, weeks, and months ahead.

EA posts Q2 loss, plans massive layoffs

Imagine how it must feel to hear that EA has acquired Playfish, a social game development company, for a possible total of $400 million USD and then in the same breath that you are losing job. That’s what some EA employees might be hearing (or have heard) today as EA reveals its abysmal second quarter results and a series of planned layoffs.

Electronic Arts said Monday that its loss widened in the second quarter and that it plans to lay off around 1500 employees, or about 17 percent of its global workforce. This would happen before April 2010, the velocity of those layoffs is an unknown at this time; for all we know they have already begun..

In the second quarter EA posted a net loss of $391 million, or $1.21 a share - a 26 percent increase over the same period a year ago. Net sales saw a 12 percent decline to $788 million in the second quarter as well. Sales, including deferred revenue from online games, did grow 2 percent to $1.15 billion during the quarter, but obviously it was not enough to pull Q2 into the black.

It must hurt those employees to hear that This morning EA announced that it had committed to purchase the outstanding assets of Playfish, one of the largest social game development studios on Facebook (and other platforms), for a total of $400 million USD (see this news story for a break-down). EA said that these layoffs, 1300 of which are part of a restructuring plan that was already in place, will be completed by March 31, 2010. According to the company, this plan will result in annual cost savings of at least $100 million and restructuring charges of $130 to $150 million.

Looking to the next quarter, EA predicts GAAP net revenue to be between $3.6 and $3.9 billion; Non-GAAP net revenue is expected to be $4.2 to $4.4 billion; GAAP diluted loss per share is expected to be between $1.20 and $2.05; Non-GAAP diluted earnings per share is expected to be between $0.70 and $1.00; and return to profitability in Q3 and Q4.

Vogster scales back workforce

CrimeCraft and Roboapocalypse developer Vogster Entertainment, have begun laying off development staff, citing a slowdown in work now that both games have finished the development cycle of both games. This is a pretty normal occurrence when you have huge development teams working on games and no work for them.

“Vogster has seen a number of releases this year. As an independent developer, we need to be very strategic in our use of available resources and shift from already launched titles to support the ongoing development and growth of CrimeCraft,” said Daniel Prousline, vice president of development at Vogster. “We regret the necessary staffing changes and the talented employees that this impacts, but it is an unavoidable step in moving to the operational stage of CrimeCraft and optimizing for the development of yet to be announced titles.”

Vogster said that, despite these layoffs, work will continue on new and exisiting Vogster projects.

Raven Software confirms staff cuts

Raven Software and studio owner Activision have confirmed with Shacknews that it has cut 30 - 50+ employees from its development studio in the post-development period following the release of X-Men Origins: Wolverine and Wolfenstein. While this is typical behavior for studios who finish up big projects and have nothing to keep its employees busy there has been some speculation that the layoffs may be the result of lackluster Wolfenstein sales. Tom Chick’s Wolfenstein review may have the answers to those questions - to say he felt the game was lacking would be a major understatement.

Currently the company is working on Singularity, with Marvel Ultimate Alliance 2 set to ship on multiple platforms very soon.

Microsoft Cuts 100 Employees

According to multiple source including VenuteBeat and Gamasutra, Microsoft has laid off 100 employees from Massive, the in-game advertising company in bought in 2006. This is a continuation of the workforce reduction it announced earlier this year. In January the company announced that it would be cutting 5,000 jobs in the next 18 months. Microsoft had already cut 1,500 of those 5, 000 jobs prior to today’s news, closing Microsoft Flight Simulator developers ACES studios in the process and finally closing Ensemble Studios

“As part of the plan we announced in January to reduce costs and increase efficiencies, today we are eliminating additional positions across several areas of the company,” a Microsoft spokesperson told Gamasutra. “Microsoft is not breaking out layoff figures by divisions.”

“While job eliminations are always difficult, we are taking these necessary actions in response to the global economic downturn,” the rep told Gamasutra in a separate statement.

Big Huge Games For Sale

THQ has informed us that if the company can’t sell Big huge Games it will be forced to close the studio. In a statement, which was a reaction to a story earlier today about layoffs at Big Huge Games, THQ’s Vice President, Investor Relations and Corporate Communications, Julie MacMedan, told us that it plans to close the studio if a sale is not completed in the “near future.”

The company also said that it has notified Los Angeles-based Heavy Iron Studios and Carlsbad-based Incinerator that they will become independent companies.

THQ says that this is all part of the company’s business realignment that it announced earlier this year. Full statement from THQ after the break.

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