Riot lays off 530 employees, will close Riot Forge: 'We're not doing this to appease shareholders or to hit some quarterly earnings number,' says CEO

Riot Games has announced that it's "refocusing on fewer, high-impact projects" to move "toward a more sustainable future," and that means layoffs: Roughly 530 employees, representing 11% of Riot's total workforce, have been let go.

In an email sent to employees, Riot CEO Dylan Jadeja said that the company has made "a number of big bets" since 2019 as it expanded into "a multi-game, multi-experience company." Now, however, there are "too many things underway" and some of those bets "aren't paying off" as well as expected.

According to Jadeja, adjustments like hiring freezes and other cost-controlling measures haven't been enough, making these layoffs "a necessity" for Riot, and—getting ahead of internet critics, perhaps—not an effort "to appease shareholders or to hit some quarterly earnings number."

"Our costs have grown to the point where they're unsustainable, and we've left ourselves with no room for experimentation or failure—which is vital to a creative company like ours," wrote Jadeja. "All of this puts the core of our business at risk."

As well as cutting employees, Riot is also making a couple of major internal changes. The League of Legends-based card game Legends of Runeterra, which hasn't met expectations, will have its development team reduced, while the ongoing development focus will change to the Path of Champions PvE mode.

Riot is also ending Riot Forge, the program it launched in 2019 to make singleplayer League of Legends games with external studios. Previous Riot Forge releases include Ruined King and Mageseeker. Upcoming crafting RPG Bandle Tale is also being published under the label.

In a message directed at players, Riot said that its new strategy will "more tightly integrate esports, music, and entertainment" with its games.

Riot has publicly shared the severance plan it's offering laid-off employees, and it is at least substantial relative to the typical offering. Everyone being put out of work will get a minimum six months of severance pay plus a bonus based on their 2023 annual performance bonus target, health benefits, additional pay for expenses that would've previously been covered by Riot's Play Fund and Wellness fund, access to job placement services for up to six months, support for those who hold visas as part of their employment, and a few other considerations, such as laptops to use for those who relied on their work device.

Google offered a similar package to employees it laid off last year, although its minimum severance pay was 16 weeks rather than Riot's six months.

These 530 laid-off Riot employees join hundreds of others in the industry who've lost jobs in recent months as layoffs continue to be one of the defining games industry trends of 2023 and 2024. Last week, Behaviour Interactive and CI Games announced layoffs, and this week we learned that developer Piranha Bytes is at risk of closing.