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Why is the video game industry in crisis? (self.outoftheloop)

submitted 6 months ago by Zeppo to c/[email protected]

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I keep hearing about layoffs, studios being closed and how the industry is troubled. Are companies losing money and sales are poor, or is it the same as Google and other companies laying off people just to pump their stock price and make money despite profitability?

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[–] [email protected] 2 points 6 months ago (1 children)

Are expenses exceeding revenues? I feel like a lot of the big companies that have laid people off are nowhere even remotely close to going into the red in absolute terms, and if they were, there would have been a five alarm panic. I mean, I can't even imagine the kind of epic shit storm that would sweep wall St if Microsoft or Google only made, say, a million dollars in profit (not revenue, mind) in the last quarter.

[–] Habahnow 1 points 6 months ago

I don't mean that expenses are higher than revenue, just that expenses are higher relative to revenue than these companies would like. This is a bear market, they need to prepare to withstand the bear market until things look better.