Unity, a prominent San Francisco-based video game company specializing in game engines has let go of 1,800 employees. Unity's plan to lay off its 25% workforce, was disclosed in an SEC filing on Monday. The layoffs plans were hinted at late last year, and the company cited reasons such as excessive growth and the need for increased efficiency in 2024.
“We are currently doing too much, we are not achieving the synergies that exist across our portfolio, and we are not executing to our full potential,” said company CEO Jim Whitehurst in a statement before the layoffs.
Unity was founded nearly two decades ago by three Danish engineers, and gained popularity among game developers for its “game engine”. It is also used in other industries like film and automotive for 3D visualization and virtual reality. After its IPO in 2020, Unity's stock reached a peak of around $200 in November 2021, but subsequently fell below $30 last year.
Layoff outlook for 2024 in Bay Area
According to Reuters, this is San Francisco-based company’s largest layoff ever, with completion expected by the end of March, the company said. While Unity is not widely recognized outside the gaming industry, over 1.1 million game creators rely on its software toolkit each month, including the maker of the popular “Pokemon Go,” “Beat Saber” and “Hearthstone” games.
In recent years, the San Francisco Bay Area has witnessed an unusually high number of mass layoffs, particularly in the tech sector, with over 100,000 jobs lost since October 2022. While the recent layoffs are disheartening, tech experts believe that the number of large-scale layoffs in the area will likely be lower than the levels observed in 2022 and 2023.
{{/usCountry}}In recent years, the San Francisco Bay Area has witnessed an unusually high number of mass layoffs, particularly in the tech sector, with over 100,000 jobs lost since October 2022. While the recent layoffs are disheartening, tech experts believe that the number of large-scale layoffs in the area will likely be lower than the levels observed in 2022 and 2023.
{{/usCountry}}Although the latter half of 2023 witnessed a general slowdown in layoffs, with companies easing on further terminations, the beginning of the new year has proven challenging. Some San Francisco startups executed layoffs within days of 2024 commencement, with Unity leading as the first major company to undergo significant downsizing. Many companies have navigated past the uncertainties of COVID-related adjustments, establishing their standing in office and remote work dynamics
Challenges faced by companies in Bay Area
Experts note that concerns about office space in San Francisco persist, but some companies are addressing this issue by cutting overheads, potentially averting future layoffs. Maintaining caution experts anticipate San Francisco's gradual recovery later in the year. As more companies report on their financial health in the coming months, the full landscape of the Bay Area's economic trajectory will become clearer.
(With agency inputs)