Unity Software Inc.
U 2.57%
is laying off more than 200 employees, making it the latest technology company to implement staff cuts amid mounting recession fears.
San Francisco-based Unity said Tuesday that 284 jobs would be eliminated. Some of those losing their jobs may be rehired for other positions if they apply for openings, the company said. Unity, a provider of tools for creating videogames and other applications, last disclosed layoffs in June, when it cut around 225 jobs. At that time, the company said it was looking to better match the size of its staff with its needs.
Some of the latest cuts at Unity are in response to negative economic trends such as the weak digital advertising market, the company said, while others are aimed at reducing duplication in job roles stemming from a recent acquisition that added more than 1,400 employees to its workforce .
Unity had more than 8,000 employees before Tuesday’s layoffs.
“We’re dealing very specifically with overlap and a handful of projects are going in the closet,” Unity Chief Executive John Riccitiello said in an interview with The Wall Street Journal.
Photos: Tech Layoffs Across the Industry: Amazon, Salesforce and More Cut Staff
Many top tech companies have been announcing layoffs as they feel the effects of inflation, rising interest rates and currency headwinds. Some have said they had added too many workers in recent years.
Amazon.com Inc.
said this month that it planned to let go more than 18,000 employees, and in November, Facebook parent Meta Platforms Inc. said it would cut more than 11,000 workers. Lyft Inc.,
Salesforce Inc.,
DoorDash Inc.,
Snap Inc.,
Stripe Inc. and Twitter Inc. have also announced layoffs in recent months.
US videogame-industry sales fell 5% last year to $56.6 billion, the first annual decline since 2016, according to a report released Tuesday from NPD Group, with mobile-gaming data from Sensor Tower.
Unity, which went public in 2020, has seen its revenue growth slow over the past year. Shares of Unity rose more than 2.5% Tuesday while the tech-heavy Nasdaq Composite Index was little changed. They are down more than 70% from a year ago, more than double the decline of the Nasdaq.
In a letter sent to employees Tuesday, Mr. Riccitiello said the layoffs are aimed at better streamlining the company’s efforts.
“We reassessed our objectives, strategies, goals and priorities in light of the current economic conditions,” he wrote. “While we remain focused on the same vision, we decided that we need to be more selective in our investments to come out stronger as a company.”
Unity’s sports and live entertainment division is being closed, with all its positions cut because they weren’t expected to drive near-term results, Unity said. For example, the division was developing technology for viewing live and recorded sports matches from any angle of the viewer’s choosing.
“In the current economy, it’s not a good time to bring that to the market,” Mr. Riccitiello told the Journal. “We are letting that team go even though we’re thrilled with the work they’ve done.”
The rest of the cuts are largely in administrative areas such as information-technology security and marketing. Unity’s $4.4 billion deal for ironSource Ltd., an Israeli mobile-app and ad-tech company, closed in November and created job redundancies, the company said.
After a period of aggressive hiring to meet heightened demand for online services during the pandemic, tech companies are now laying off many of those workers. And tech bosses are saying “mea culpa” for the miscalculation. WSJ reporter Dana Mattioli joins host Zoe Thomas to talk through the shift and what it all means for the tech sector going forward.
Write to Sarah E. Needleman at [email protected]
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Appeared in the January 18, 2023, print edition as ‘Software Firm Cuts 284 Staff Positions.’
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