Japanese mobile and web3 game developer Gumi wants around 80 employees to accept voluntary redundancy so it can downsize to “achieve sustainable growth.”
The company broke the news in a press release (via Google Translate) spotted by Game World Observer and said it reported a net loss of 5.9 billion yen ($37.8 million) during the last fiscal year. It appeared to blame that loss on the performance of Aster Tatarics, which delivered “significantly” lower than expected sales.
“In order to ensure the soundness of management and achieve sustainable growth in a difficult environment including market conditions, it is necessary to revamp our existing development policies and systems. We are aware that there is,” reads the translated press release.
“Specifically, for the time being, we will not develop original titles that are highly risky, and instead will distribute low-cost titles with a high probability of profit by combining our proven game engine with powerful IP, as well as develop more commissioned titles. With this acquisition, we will quickly transition to a system that can continuously generate stable earnings.”
As part of that revamp, Gumi is offering “voluntary retirement” packages to employees who may find it difficult to “coexist” with its new business plan. It indicated the offer will be open to all workers and said people will be able to put themselves forward between June 17 and July 5.
Gumi hopes the process will enable it to cut around 80 jobs by July 31, 2024. “Employees who retire under this system will be treated as company-initiated retirement and special retirement benefits will be provided,” it added. “We will also provide re-employment support through an out-employment support company for those who wish to do so.”
The cost of the redundancies is expected to total approximately 100 million yen. That outlay will be reported as an extraordinary loss during the first quarter of the current fiscal year.
Dr. Serkan Toto, CEO of Japan game industry consultancy Katan Games, said this is essentially a “rare” case of layoffs in Japan, where it’s “generally not possible to just fire employees.” “Gumi will offer special retirement allowance packages and other things to employees who then need to ‘resign,’ a technicality often used by Japanese companies in these situations,” he added.