The lights are on
Update: Valve co-founder, Gabe Newell issued a statement regarding the company's recent changes and confirmed no projects are being canceled right now.
Newell told Engadget, "We don't usually talk about personnel matters for a number of reasons. There seems to be an unusual amount of speculation about some recent changes here, so I thought I'd take the unusual step of addressing them. No, we aren't canceling any projects. No, we aren't changing any priorities or projects we've been discussing. No, this isn't about Steam or Linux or hardware or [insert game name here]. We're not going to discuss why anyone in particular is or isn't working here."
Although, Newell acknowledged recent changes he didn't offer specifics, and company reps wouldn't confirm layoffs. Although, Jeri Ellsworth, an electrical engineer for the company, tweeted that she was fired today. We anticipate more information will surface soon.
We're used to hearing about layoffs in the gaming industry (especially recently), but rarely have we heard of such events at Valve. Despite this, a new Gamasutra report claims that many former employees are newly out of work.
According to the report, the number "25" has been thrown around, and that the hardware and Android development departments have been affected. Some employees have referred to the layoffs as the "great cleansing." No official word from Valve yet regarding this report, but we'll update this story accordingly if they give word.
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They've been doing some R&D so I wouldn't be surprised if people were let go after that was finished.
Seems perfectly normal to me. They're new to hardware, so they are still trying to optimize efficiency, and part of that is firing a lot of people before you find the ones that best fit the position. My point being that it probably isn't a sign of financial problems for Valve.
I'd suspect they might have been temporary/contract jobs as they move into hardware development--but to refer to it as a "great cleansing" is a little worrying.