Chapter 1: EA's Recent Organizational Changes

In a surprising move, EA has confirmed a significant restructuring within the company, which will lead to the layoff of 670 employees, roughly 5% of its workforce. This announcement comes alongside the cancellation of the Star Wars first-person shooter (FPS) that was under development at Respawn.

Following Chief Andrew Wilson's announcement regarding these cuts, EA Entertainment president Laura Miele sent a memo to staff elaborating on the company's future business priorities. She confirmed that the early-stage Star Wars FPS would be shelved as EA shifts its focus towards its own franchises and further development of existing games. However, the Star Wars: Jedi series will persist amid this transition, indicating EA's commitment to maintaining its ties with the beloved franchise.

"It's always challenging to let go of a project, and this decision does not reflect the team's talent, dedication, or enthusiasm for the game," Miele noted. "Delivering the next installments of the iconic franchises that fans desire is crucial for impactful storytelling and where we should concentrate our efforts."

While details about the Star Wars FPS remain scarce, there were rumors of it featuring a Mandalorian hero. The fate of EA's Star Wars strategy game, however, is still uncertain. EA is reportedly adjusting to what it perceives as a swift shift towards expansive open-world games, large communities, and games with live support.

The team that was working on this FPS will likely be reassigned to various projects, including Apex Legends, Iron Man, Black Panther, and a confirmed third installment of Jedi. Despite the shift in focus towards owned IPs, EA remains dedicated to its longstanding partnership with Disney/Marvel.

The first video highlights the significant updates for Respawn's upcoming Star Wars FPS.

Chapter 2: Impact of EA's Restructuring

In addition to the layoffs, EA will reorganize its Battlefield teams following the departure of Marcus Lehto, which was announced yesterday. The studio, Ridgeline Games, is being closed, and some of its developers will be integrated into the larger Battlefield franchise. Danny Isaac and Darren White at Rule will now oversee the single-player aspects of the series.

Moreover, EA plans to sunset several mobile games, including the previously announced F1 Mobile Racing and MLB Tap Sports, alongside titles like Kim Kardashian: Hollywood and The Lord of the Rings: Legends of Middle-earth. This aligns with EA's pivot towards in-house franchises such as Apex Legends.

IGN has learned that EA intends to refocus its development and business strategies on a select few major franchises, such as EA Sports, Apex Legends, Star Wars: Jedi, Iron Man, Black Panther, Battlefield, Need for Speed, Dragon Age, Skate, and The Sims. A team is still working in pre-production on the next Mass Effect, although BioWare is primarily concentrating on Dragon Age at the moment.

"It's important to recognize that these changes are not just words; they have a direct impact on your daily work and often result in job losses and farewells to talented colleagues," Miele expressed. "I will always prioritize the human aspect of these decisions, and I understand that change and disruption are challenging. In tough times, we must remember the importance of showing up for our players and for each other."

The second video discusses Respawn's ongoing work on the final chapter of the Star Wars Jedi series.

Chapter 3: The Broader Industry Landscape

The gaming industry continues to experience significant upheaval, with layoffs impacting numerous companies. In the fiscal quarter ending December 2023, EA reported net bookings of $2.37 billion, a 7% increase year-over-year, alongside net revenue of $1.945 billion, largely driven by EA Sports FC and other franchises. The recent layoffs are part of a broader trend affecting approximately 10,000 developers throughout 2023, with nearly 8,000 layoffs occurring in the first two months of 2024 alone.

EA had previously cut 6% of its workforce nearly a year ago, with similar motivations cited for the current layoffs. Despite these reductions, the total employee count before today's announcements remains higher (13,400) than during the last round of layoffs (12,900).

The company's SEC filing indicates that it anticipates incurring costs between $125 million and $165 million related to these layoffs, including expenses associated with reducing office space, severance packages, and fees linked to licensing agreements, particularly concerning the canceled Star Wars game.