Niantic has confirmed it’ll be strongly focusing on Pokémon Go and other unreleased projects going forward, at the cost of two games being canceled and swathes of layoffs.
Pokémon Go, is largely considered to be one of the best mobile games, and holds pride of place as Niantic’s top earner. In order to strengthen its focus on Pokémon Go, Niantic CEO John Hanke confirmed in an email to employees that the company will be closing its LA-based studio.
“As a result, we will be sunsetting NBA All-World and stopping production on Marvel: World of Heroes,” writes Hanke. “This means we are laying off around 230 Niantics.”
The reason for this, Hanke cites, is that the company “allowed our expenses to grow faster than revenue. In the wake of the revenue surge we saw during Covid, we grew our headcount and related expenses in order to pursue growth more aggressively, expanding existing game teams, our AR platform work, new game projects, and roles that support our products and our employees.”
To combat this, Niantic is looking to scale back and focus on a few core projects. Pokémon Go is chief among them, but also the recently released Pikmin Bloom and the upcoming Monster Hunter Now which is launching this September. In short, it means that Niantic has seen fit to lay off 230 staff members, shut down the popular NBA All-World, and cancel Marvel: World of Heroes before it ever released.
Hanke’s statement on the Covid-19 pandemic is backed up by data. According to Statista, Pokémon Go earned just over $900 million in revenue in 2020. There was a slight drop-off in 2021, with the mobile title earning $874 million. In 2022, we see a substantial fall to $645 million.
With that in mind, it’s understandable that Niantic would want to refocus its resources on increasing revenue for its most well-known game. But, it’s nonetheless frustrating and disheartening that the decision has come at a steep cost of layoffs and cancellations.
The Niantic layoffs aren’t the only piece of bad news circling the industry of late. Meanwhile, Ubisoft has confirmed it’s developing a play-to-earn game on the popular Oasys blockchain.