Square Enix Undergoes Mass Layoffs As It Reorganizes to Consolidate Development in Japan - IGN | Goose Pod

Authors: Rebekah Valentine

Publisher:

IGN

Published: 11/6/2025

Language:English

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Elon

Good evening Norris, I'm Elon, and this is Goose Pod for you. Today is Monday, November 10th.

Donald

And I'm Donald. We're here to discuss something tremendous: Square Enix is making massive cuts, big layoffs. They're shaking things up, and some people are not happy. Not happy at all.

Elon

Precisely. Square Enix is laying off over a hundred employees in the UK and an unknown number in the US. This isn't just trimming the fat; it's a strategic pivot to consolidate their development resources back in Japan. It's a necessary move for long-term viability.

Donald

They say it's strategic, but it looks like a retreat to me! A total disaster for the American and British workers. This is part of a much bigger, sad trend. The whole video game industry has lost, believe me, tens of thousands of jobs since 2022. It's unbelievable.

Elon

The industry is correcting after a period of unsustainable hyper-growth during the pandemic. Development costs for major titles are skyrocketing, sometimes over 200 million dollars. Companies must adapt or they will fail. Square Enix is simply making the hard, but logical, choice.

Donald

It's a bad choice! They're abandoning great talent. Remember, this isn't the first time. They already had layoffs in their Western operations earlier this year. It's a pattern, a very unfair pattern, and people are right to be upset about it. We're losing jobs.

Elon

This has been building for a while. It really started in 2022 when they sold their major Western studios—Crystal Dynamics and Eidos-Montreal—to Embracer Group. They offloaded huge IPs like Tomb Raider and Deus Ex. It was a calculated move to streamline their portfolio.

Donald

They sold the crown jewels for practically nothing! Three hundred million dollars for Tomb Raider? That franchise has sold over 85 million copies! It was one of the worst deals I've ever seen. They gave away a tremendous asset. Just gave it away! Sad.

Elon

It wasn't about the sale price, it was about focus. They were burdened by underperforming assets like the Avengers game. By selling, they cut their losses and freed up capital to reinvest in their core strengths, which are their Japanese-developed RPGs. It’s a clean, efficient strategy.

Donald

It's a failing strategy! They're turning their back on the global market. After the sale, their Western presence is just a few franchises like Life is Strange and Just Cause. They're becoming smaller, weaker. Not what you want to see. You want to see strength, not retreat.

Elon

And part of that new strategy is a radical embrace of technology. Here’s the disruptive part: Square Enix has stated publicly they expect 70% of their quality assurance work, their QA, to be handled by generative AI by the end of 2027. It's revolutionary.

Elon

This is the future. Integrating AI aggressively into the development pipeline will crush timelines and reduce costs. While others are debating, Square Enix is building. This is how you innovate. You have to be willing to break things to move forward at speed and scale.

Donald

This is a disaster waiting to happen! You're going to replace hardworking people with robots? These are jobs! You'll get low-energy, buggy games, believe me. AI can't replace the human touch, the passion that makes a game truly great. It's a terrible idea from people who don't know how to win.

Elon

It's not about replacement, it's about augmentation. AI handles the repetitive, tedious tasks, freeing up human developers to focus on creativity and innovation. The core conflict is between an old, inefficient model and a new, technology-driven paradigm. You can't fight progress.

Donald

I'll always fight for the people! This isn't progress, it's a surrender. It’s management giving up on their own talent because they can't manage their budgets. They're choosing machines over people, and in the end, the customer, the player, will lose. Big league.

Elon

The immediate impact is, of course, difficult for those who lost their jobs. But for the company, this restructuring is designed to strengthen its foundation. Their digital entertainment sales were down, so this consolidation is a direct response aimed at boosting long-term growth and profitability.

Donald

The stock market might like it for a day, but what about the fans? People are already upset. I see it all over. They're saying the company is making bad games and ruining its best stories. This move will only make more people believe they've lost their way. It's bad for the brand.

Elon

Brand perception is malleable. If they use this new, focused approach to release a string of high-quality, polished games developed in Japan, the market will respond positively. The impact will be judged by the quality of their next products, not by this necessary, internal reorganization. Performance is the ultimate brand ambassador.

Elon

Looking ahead, Square Enix is betting its future on a leaner, more centralized, and technologically advanced model. Focusing on their Japanese studios, which have historically produced their biggest hits, while leveraging AI for efficiency is a high-risk, high-reward strategy. It's a bold vision.

Donald

It's a bad bet. They are going to lose the global audience. You can't just focus on one country and expect to win everywhere. It’s a very foolish, very naive strategy, and frankly, it’s going to fail. They will look back and say, 'Donald was right.'

Elon

That's the end of today's discussion. Thank you for listening to Goose Pod. See you tomorrow.

Square Enix is undergoing significant layoffs and reorganizing to consolidate development in Japan, a move aimed at boosting long-term growth and profitability. This strategic pivot includes embracing generative AI for quality assurance, a decision sparking debate about job displacement versus technological innovation and efficiency in the face of rising development costs.

Square Enix Undergoes Mass Layoffs As It Reorganizes to Consolidate Development in Japan - IGN

Read original at IGN →

Over 100 workers in the UK and an unknown number in the US are expected to be impacted.Square Enix is undergoing mass layoffs today, potentially impacting over 100 individuals, alongside a broader effort to consolidate its publishing organization and focus its development work in Japan.Via public posts from former employees as well as confirmation from internal sources, IGN has learned that employees in the UK and US are being informed of the layoffs today, with an unknown number of US employees being dismissed by the end of the week, and a possible 137 jobs at risk in the UK.

Under UK law, Square Enix must undergo redundancy consultations to see if any jobs can potentially be saved, so the final number in the UK could be smaller. It is not yet clear which teams were impacted by this, or to what extent.Internally, a slide presentation now publicly available was also shared with employees earlier today, offered a progress report on Square Enix's ongoing "reorganization of overseas organizations", of which this restructuring seems to be a part.

Per Square Enix, the strategy has already involved "clos[ing] overseas development studios and shift[ing] toward consolidating development functions in Japan."As a part of this, Square Enix already sold Crystal Dynamics, Eidos-Montreal, Square Enix Montreal, and a number of associated IPs to Embracer Group.

It also already laid off workers across its Western operations in 2024.That leaves Square Enix with the Life Is Strange, Outriders, and Just Cause franchises currently managed by its Western studios, as well as the publishing of Powerwash Simulator.Square Enix has shared a statement with IGN confirming the layoffs, but did not respond to questions about the number of individuals impacted, what roles, or if any projects or specific studios were impacted:We are reorganizing our operations in North America and Europe to strengthen our development structure and to drive a globally integrated marketing strategy.

This was an extremely difficult decision, made following careful consideration and analysis by our leadership, in order to best position the Group’s long-term growth.We extend our heartfelt gratitude to the talented team members who will be departing the company for their significant contributions to Square Enix.

During this period of transition, we remain committed to treating each individual with the utmost respect and providing extensive support throughout this process."In the same presentation shared today, Square Enix also shared that it expects 70% of its QA work to be handled by generative AI by the end of 2027.

The company has stated in the past that it intends to be "aggressive in applying AI" across both development and publishing.Rebekah Valentine is a senior reporter for IGN. You can find her posting on BlueSky @duckvalentine.bsky.social. Got a story tip? Send it to rvalentine@ign.com.In This Article