Niantic, Inc., the American software development company based in San Francisco, announced it will close down its Los Angeles studio and shift away from internal game development.
These changes will result in the layoff of 230 employees, the discontinuation of the title NBA All-World and the cancellation of the upcoming Marvel: World of Heroes game, the company's founder John Hanke said in an email.
"I have made the decision to narrow our focus for mobile game investments, concentrating on first-party games that most strongly embody our core values of location and local social communities," Hanke wrote.
"The mobile gaming market is very mature and only the best and most differentiated titles have a chance to succeed. We also want to increase our focus on building for the emerging class of MR devices and future AR glasses," Hanke added.
The reason behind the job cuts was bluntly explained by Niantic's founder: "We have allowed our expenses to grow faster than revenue."
Hanke said the company's top priority will be maintaining the growth and health of Pokémon Go as a long-lasting game. Also, Niantic aims to achieve success with its recently launched games, such as Pikmin Bloom, Peridot and Monster Hunter Now, focusing on user retention, revenue generation, and profitability.
The gaming industry has been witnessing a recurring trend of layoffs, with numerous well-known studios and companies experiencing significant staff reductions.
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