Bandai Namco Holdings Inc is reducing its workforce and discontinuing several game titles as rising costs and plateauing demand hit the gaming industry. The company, known for iconic games like Pac-Man, Dragon Ball, and Gundam, is facing pressure to cut costs as the post-pandemic gaming boom fades.
The Tokyo-based company is reportedly using "expulsion rooms" (oidashi beya) to encourage voluntary resignations. Approximately 200 employees from affiliate Bandai Namco Studios Inc have been sent to these rooms since April, with nearly 100 resigning so far. The company denied that these rooms are intended to pressure employees, stating that staff are simply awaiting new assignments as projects emerge.
Bandai Namco has been forced to cancel or pause development on several high-profile titles, including games based on popular anime Naruto and One Piece, as well as a project commissioned by Nintendo. The company’s smartphone and online games have been hit hardest, leading to ¥21 billion (US$141 million) in write-downs over three quarters. Recent titles like Tales of the Rays and Blue Protocol have been shuttered or scheduled for discontinuation.
This trend is mirrored by other gaming giants. Square Enix Holdings Co and Sony Group Corp have also canceled multiple underperforming games. Bandai Namco's shares dropped 1.2% in Tokyo following the news, as the company adjusts to the challenging market conditions.
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