Earlier today, we heard that Zynga had laid off a number of workers and had shut down its Boston studio. At the time, those were only reports, but this afternoon Zynga CEO Mark Pincus confirmed the layoffs and the studio closure to employees in an internal letter posted by Joystiq. In the letter, Pincus explains that not only will Zynga be closing its studio in Boston, but also reducing the workforce at its Austin branch.
In all, Zynga will have to layoff 5% of its full time employees. More layoffs may come later on down the road, as Pincus says that executives are proposing the shut down of studios in Japan and the UK. Not only that, but Zynga will be retiring 13 games and “significantly reducing” its investment in The Ville, a game which Electronic Arts is currently suing the company over.
Those 13 games aren’t named in the letter, so it could be any combination of social and mobile games. The fact that Zynga will stop supporting 13 different games and could potentially close down three studios entirely signifies that the company is in a heap of financial trouble, which won’t come as a surprise to a lot of folks.
After all, Zynga has been struggling financially for a while now as its customers move from Facebook to mobile gaming, and tomorrow’s financial report probably isn’t going to bring any good news. Pincus says in his letter that “These reductions, along with our ongoing efforts to implement more stringent budget and resource allocation around new games and partner projects, will improve our profitability and allow us to reinvest in great games and our Zynga network on web and mobile.” Here’s hoping that’s the case, because it’s never good to hear to that people will be losing their jobs.