2022–2025 video game industry layoffs

The video game industry experienced mass layoffs in a wave which began in 2022, peaked in January 2024 and began to ease off in 2025. An estimated 45,000 jobs were lost from 2022 to July 2025. These layoffs had reverberating effects on both established and emerging games companies, impacting employees, projects, and the overall landscape of the games industry. Major job cuts took place at Embracer Group, Unity Technologies, Microsoft Gaming, Electronic Arts, Sony Interactive Entertainment, Epic Games, Take-Two Interactive, Ubisoft, Sega, and Riot Games. The layoffs caused several video games to be canceled, video game studios to be shut down or divested from their parent company, and thousands of employees to lose their jobs.

The COVID-19 pandemic led to an increase in interest in gaming globally, and was a period of dramatic expansion in the industry, with many mergers and acquisitions conducted. In many cases companies over-expanded, as this rapid COVID-era growth was unsustainable. The industry began to slow in 2022, and amid spiralling costs and a shift in consumer habits, layoffs began. These were primarily limited to China and Russia to begin with, with the Chinese industry adversely affected by a licensing freeze and the Russian industry by the Russian invasion of Ukraine respectively. From 2023, North America and Europe were severely affected, particularly California which accounted for 50% of all layoffs. By 2025, approximately 26% of European game developers had been laid off at least once over the period, and salaries fell in a number of roles due to high competition. Unity programmers in particular saw their salaries fall by an estimated 50%. Over 30 video game development studios laid off their entire staff and shut down. Some of the most notable company closures include: Monolith Productions, Bluepoint Games, Arkane Austin, Sanzaru Games, The Initiative, Ready at Dawn, Luminous Productions, Volition, London Studio, Pixelopus, Riot Forge, Armature Studio, Twisted Pixel Games, and others.

According to a report by DDM Games, the industry is currently in a "reset phase." Companies are restructuring their operations through closures, layoffs, and divestitures. The pandemic-induced growth surge has subsided, leading to a need for recalibration. AI is a concern for many developers also, though there is no indication that layoffs have been driven directly by its adoption. It may however have impacted illustrators and other professions particularly exposed to automation. FunPlus CBO Chris Petrovic expects the industry to return to growth in 2026, with that growth primarily originating in developing regions like China, Turkey and Vietnam.