Pokémon Go maker Niantic is laying off 230 employees and cancelling multiple games as part of a reorganization.
In a statement, John Hanke, the CEO of the San Francisco-based mobile game developer, attributed the moves to “internal and external factors,” including global inflation.
“In the years since Pokémon Go‘s launch, the mobile market has become crowded and changes to the app store and the mobile advertising landscape have made it increasingly hard to launch new mobile games at scale,” Hanke wrote. He also admitted that the initial revenue surges Niantic saw in the early days of the pandemic led it to ramp up spending on new projects and employees, but expenses have since grown exponentially.
Indeed, Omidia Analyst Guillermo Escofet estimated last year Pokémon Go’s revenue dropped nearly 50 percent in 2022, while the broader mobile AR game market saw a 20 percent decline in revenue. Overall, global spending on mobile games dropped a reported five percent last year, according to analytics firm Data.ai.
Going forward, Hanke says supporting Pokémon Go will remain the company’s “top priority” while also wanting to “increase our focus on building for the emerging class of MR devices and future AR glasses.” The developer is also set to release Monster Hunter Now with Capcom in September, on top of supporting Pikmin Bloom and the recently released Peridot.
Image credit: Niantic