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Report: Square Enix's American and European departments to be hit by layoffs

This comes after the company announced the cancellation of several unannounced games earlier today.

Final Fantasy 14 Online
Image credit: Square Enix

Another massive video game company has been hit by layoffs in what is proving to be one of - if not the - toughest period for those working in the industry in recent memory. This time it's Square Enix up to the cutting board, as the company has announced layoffs in both its European and American departments. Square Enix itself has yet to offer an official announcement.

This, first reported by VGC, comes soon after Square announced poor financial results compared to last year, due in large part to the cancellation of some unannounced video games. This move was made to better fit with a new longer-term company strategy - dubbed "Square Enix Reboots and Awakens" - but has resulted in a 70% profit deficit in contrast to this time last year.

What these games are remains a mystery, but it appears that the publication of this information came as a retreating tide, followed shortly by this wave of Square Enix layoffs. The news was broken to staff via a company'wide town hall meeting, in which president Takashi Kiryu stated that over the next month those from publishing, IT, and Square Enix’s Collective indie games division would be most affected. The exact number of layoffs has not been confirmed.

Square Enix's president Takashi Kiryu has been keen to push new approaches and strategies for the company. It was only at the start of this year that he, in a new year's letter to the world, announced the company would be "aggresive" in its use of AI in future video games. We've seen AI being used to a minor degree in Foamstars, but we've yet to see any significant inclusion in Square Enix games.

Perhaps more importantly, these layoffs come relatively soon after Square Enix sold many of its Western studios and IP to Embracer Group. These studios, responsible for games such as Deus Ex and Tomb Raider, were then caught in the hurricane of Embracer's ongoing layoff spree, with Eidos Montreal taking a major hit in particular, losing 100 staff and having a Deus Ex game canned. So the Western portion of Square Enix's company has certainly been beaten up quite badly, this news included.

It seems that this rollercoaster of layoffs and studio closures shows no sign of ending. In an industry bloated with recently laid-off developers, you've got to wonder how much talent will be able to stick it out until new opportunities arise, and how many we might sadly lose forever.

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