Sega to layoff 240 Employees, to sell off Relic Entertainment

Credit: festivus31 on DeviantArt

Sega Europe is undergoing a strategic pivot, offloading Relic Entertainment and streamlining its workforce by a hefty 240 employees. This follows on the heels of the Hyenas cancellation and layoffs from last year.

Relic, the studio behind franchises like Company of Heroes and Age of Empires 4, is setting sail for independent waters with the backing of a mysterious UK investor, Emona Capital (who also fancies game dev services company Amber). This ensures continued support for Company of Heroes 3, including the upcoming April update.

Meanwhile, Sega Europe is downsizing under the banner of “optimizing fixed expenses.” This not-so-subtle euphemism translates to layoffs across Sega Europe, Creative Assembly (home to the Total War series), and mobile outfit Sega Hardlight. Financials suggest Sega expects to take a $10 million bath on the restructuring.

This isn’t Sega’s first brush with the layoff axe. The Hyenas cancellation in 2023 saw 250 people lose their jobs, bringing the total headcount reduction to around 500 in the past year. That figure doesn’t even include the 121 layoffs that hit Relic back in May 2023.

Sega Europe blames the restructuring on a brutal one-two punch: the post-pandemic decline in stay-at-home gaming and the inflationary economic downturn. This sentiment echoes comments from industry experts who point to the “collective delusion” of sustained pandemic-era growth. The reality is a return to incremental gains, with some executives prioritizing short-term wins over long-term stability. This, coupled with other industry shifts, has created a volatile period putting immense strain on game development workforces. Industry trackers estimate that over 8,000 game industry employees have been laid off in 2024 alone, following a brutal 2023 that saw over 10,000 lose their jobs.

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