Game software development company Unity has stated that it will “likely” be making cuts to its staff and that it expects to do so before the end of Q1 2024 (presumably prior to April).
This announcement came via the company’s Q3 shareholder letter, which was published yesterday (November 9). In the letter, interim CEO Jim Whitehurst said that while he believes the company has “a significant opportunity to accelerate revenue growth, improve profitability metrics and increase free cash flow generation going forward,” currently, “we are not executing to our full potential.” He added: “We aim to address these opportunities to emerge as a leaner, more agile, and faster growing company.”
Further down in the letter, it’s revealed that the company started a “comprehensive assessment” of its product portfolio several weeks ago to “focus on those products that are most valuable to our customers,” and is also “evaluating the right cost structure that aligns with the more focused portfolio.” While “final decisions” on this will be made “over the next few weeks,” Unity expects to roll out its plan within this quarter, and “complete all interventions” before the end of Q1 2024.
“This will likely include discontinuing certain product offerings, reducing our workforce, and reducing our office footprint,” the letter reads.
This comes after what’s been a turbulent few months for Unity. In September, the company announced the controversial “Unity Runtime Fee”, and initially stated that developers of games made using its engine, that had surpassed certain thresholds (based on their game’s lifetime installs and yearly revenue), would be subject to an extra monthly fee, calculated using the additional number of game installs per month.
The announcement was met with significant backlash, and, not long after, the president of Unity Create, Marc Whitten, apologized for the upset and revealed some changes to the policy. Unity Personal and Plus users will no longer be affected, and the Runtime Fee will only apply to games created with the next long-term support (LTS) releasing in 2024.
Shortly after this, in October, it was announced that former CEO John Riccitiello was retiring from his roles at the company, effective immediately. At the time, he said: “It’s been a privilege to lead Unity for nearly a decade and serve our employees, customers, developers, and partners, all of whom have been instrumental to the company’s growth.”
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