Niantic Spatial is laying off 68 employees, following the USD $3.5 billion sale of its games division to Saudi-owned mobile game company, Scopely. At the time of this deal, it was confirmed that Niantic would continue as a “geospatial AI company powered by a next-generation map.” Now, it appears it will also downsize, to restart operations as more of a “startup organisation.”
Niantic CEO John Hanke announced these layoffs would take place, swiftly following Scopely’s acquisition of titles like Pokemon Go, Monster Hunter Now, and Pikmin Bloom (as well as their teams), but the exact number of employees set to be laid off has only recently been uncovered, via a Worker Adjustment and Retraining Notification (WARN) reported by Game Developer.
Per comments made by Hanke in his initial layoff announcement in March, the 68 staff departing have lost their jobs as “it became clear that some roles would not be required” given Niantic Spatial’s new focus, away from games.
“These decisions are never easy; they in no way reflect the individuals’ performance, and we understand their impact on people’s lives,” Hanke said.
Read: Pokemon Go and other Niantic games set to be acquired by Saudi Arabia’s Scopely
For now, it’s unclear how the company will change with fewer staff on board. It’s worth noting the company did have a rocky few years prior to the sale of its biggest gaming franchises, with a pandemic boom being unsustainable, in the long run. It’s a company quite used to sudden, dramatic shifts.
While Pokemon Go maintains a passionate fanbase, interest in the title and generated revenue did slow over time. Niantic was also forced to shut down its NBA All-World game in late 2023 due to a lack of popularity, and it cancelled its Marvel: World of Heroes AR game in the same period.
“We have allowed our expenses to grow faster than revenue,” Hanke posted at the time. “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. Post Covid, our revenue returned to pre-Covid levels and new projects in games and platform have not delivered revenues commensurate with those investments.”
These challenges disrupted business for Niantic, and contributed to a spiral that concluded with the sale of its games division to Scopely. It’s likely the buyout became a necessity to keep the company afloat – although layoffs in the face of a USD $3.5 billion sale do feel quite strange. As IGN points out, Niantic Spatial was formed of significant cash flow – USD $250 million in capital, USD $200 million from Niantic, and USD $50 million from Scopely.
As always in cases like these, our thoughts are with those employees now laid off, in one of the toughest times for the games industry, and the global economy, yet.
