The Pokémon Go studio is shuttering its Los Angeles office
Niantic, the mobile developer known for games like Pokémon Go and Pikmin Bloom, is making some big cuts. The company is shuttering its Los Angeles office, closing down NBA All-World, cancelling an upcoming Marvel project, and laying off roughly 230 employees.
In an email to employees, as first reported by Kotaku, Niantic CEO John Hanke says he has made the decision to narrow the company’s focus for mobile game investments.
“The mobile gaming market is very mature and only the best and most differentiated titles have a chance to succeed,” Hanke said.
Specifically, Niantic is closing its LA studio and reducing the game platform team, alongside reductions across the company, which will result in “around 230” employees laid off. NBA All-World is being sunset, and production is ceasing on Marvel: World of Heroes.
It’s a pretty sudden, drastic shift. When addressing why these changes are happening, Hanke says the answer is “straightforward”; that Niantic allowed 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,” Hanke said. “Post Covid, our revenue returned to pre-Covid levels and new projects in games and platform have not delivered revenues commensurate with those investments. This change will bring expenses and revenue back into line while preserving our core assets and long term upside.”
A new reality
Moving forward, Hanke says Niantic will keep working on augmented reality. Pokemon Go remains a “forever game” and a top priority. Hanke also says he is confident about Pikmin Bloom, Peridot, and Monster Hunter Now‘s prospects.
The reduction of the platform team, though, is a reflection of Niantic’s goal to “do less, better.” It is, still, a rough day for the developers who work at Niantic and make all of these AR experiences happen.
