Introduction
Game software developer Unity has announced that it will be reducing its global workforce by around 8%, equating to approximately 600 employees. This is the third round of layoffs within a year, with 225 employees being let go last June and 284 at the beginning of this year.
The Reason for the Layoffs
Recently, Unity CEO John Riccitiello revealed that middle management positions would be affected by the layoffs. He claimed that the company had too many layers and needed to restructure to achieve higher growth. Unity also aims to decrease the number of its offices globally.
Shifting to a Hybrid Work Model
Unity wants employees to start coming to the office more often. The company plans to shift to a hybrid work model starting in June, where employees will have to work from the office at least three days per week according to this new mandate.
Financial Performance
Despite posting its best fiscal quarter and year in company history, Unity has decided to lay off employees. In Q4 of February, the company reported revenue of $451 million, a 43% increase from the same period in 2021 and the first profitable quarter since becoming a publicly traded company.
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Investor Reaction
Despite multiple rounds of layoffs, investors seem unimpressed with Unity’s performance as its stock has gone down by 11% since the beginning of the year. Unity is expected to reveal its Q1 earnings next week.
Conclusion
Unity’s third round of layoffs has affected around 600 employees, making it a significant reduction in the workforce. The company is restructuring to achieve higher growth and is also moving towards a hybrid work model. Despite its recent financial success, investors have reacted negatively to the news, and Unity’s stock has fallen. It remains to be seen how the company will perform in the future.