Niantic, the creator of hit mobile game Pokemon Go, announced it is laying off 230 employees and reorganizing its business as it grapples with new macroeconomic uncertainty.
In a letter to staff announcing the job cuts, Niantic CEO John Hanke said the company is taking other significant actions as well: shuttering its Los Angeles studio, sunsetting its NBA All-World game and halting production on Marvel: World of Heroes.
The privately held company's breakout hit, Pokemon Go, was among the first mobile games to embrace augmented reality when it launched in 2016.
Hanke went on to state what has become a familiar refrain among tech CEOs announcing layoffs: The company grew too fast during the boom in demand for digital services seen in the early days of the pandemic, and now must adjust to a new environment.
"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 wrote.
Eventually, however, "our revenue returned to pre-Covid levels and new projects in games and platform have not delivered revenues commensurate with those investments," he added.
The reorganization, Hanke said, "will bring expenses and revenue back into line while preserving our core assets and long term upside."
In his memo to staff on Thursday, Hanke said that the company is now facing an augmented reality market "that is developing more slowly than anticipated, because of technology challenges and because larger players are slowing down their investments in light of the macro environment."
Still, Hanke emphasized that the company's "top priority" going forward is to "keep Pokémon GO healthy and growing as a forever game." He also said that remaining staffers should expect "a more direct and results-based culture."
Some 211,630 people in the tech industry have been laid off this year alone, according to data tracked by Layoffs.fyi, already surpassing the 164,709 figure recorded in full-year 2022.