Discord Lays Off 170 Employees Due To Overhiring

Community chat application company, Discord, has laid off 170 employees, or 17 percent of its staff, according to a new report from The Verge. Discord CEO Jason Citron cites overhiring, which has led to the company becoming "less efficient" in how it operates. The layoffs affected people across various departments. 

The Verge obtained an internal memo from Citron sent to employees announcing the layoffs, which have already happened. That memo explained why the layoffs were happening, when affected employees would receive the email telling them they no longer have a job, and follow-up meetings for those who remain at Discord. 

"We grew quickly and expanded our workforce even faster, increasing by 5x since 2020," Citron writes in the memo. "As a result, we took on more projects and became less efficient in how we operated. Today, we are increasingly clear on the need to sharpen our focus and improve the way we work together to bring more agility to our organization. 

"This is largely what drove the decision to reduce the size of our workforce. While difficult, I am confident this will put us in the best position to continue building a strong and profitable business that delivers amazing products for our users and supports our mission for years to come." 

You can read the full internal memo at The Verge here. The Verge writes that Discord raised about $1 billion in funding in total, with more than $700 million "in cash on its balance sheet and the goal to become profitable this year," according to the publication's sources. 

These Discord layoffs follow a heartbreaking trend in these first couple of weeks of 2024. Just this week, we learned video game engine creator Unity is planning to lay off 1800 employees (25 percent of its workforce) by the end of March, and that streaming company Twitch is laying off 500 people (35 percent of its staff). 

This string of layoffs this week follows a terrible 2023 for the people who make games and those in game-adjacent industries. 

In January of last year, Microsoft laid off 10,000 employees amidst its ongoing $69 billion acquisition of Activision Blizzard, which it completed in October. 

Striking Distance Studios, the team behind 2022's The Callisto Protocol, laid off more than 30 employees in August of 2023. That same month, Mass Effect and Dragon Age developer BioWare laid off 50 employees, including long-time studio veterans. The following month, in September, Immortals of Aveum developer Ascendant Studios laid off roughly 45% of its staff, and Fortnite developer Epic Games laid off 830 employees. 

In October of last year, The Last of Us developer Naughty Dog laid off at least 25 employees, and Telltale Games also underwent layoffs, although an actual number of affected employees has not yet been revealed. Dreams developer Media Molecule laid off 20 employees in late October.

In November, Amazon Games laid off 180 staff members, Ubisoft laid off more than 100 employees, Bungie laid off roughly 100 developers, and 505 Games' parent company, Digital Bros, laid off 30% of its staff. 

In December, Embracer Group closed its reformed TimeSplitters studio, Free Radical Design, and earlier in the year, Embracer closed Saints Row developer Volition Games, a studio with more than 30 years of development history. A few weeks before the winter holidays, Dungeons & Dragons and Magic: The Gathering owner Hasbro laid off 1,100 employees. 

The games industry will surely feel the effects of such horrific layoffs for years to come. The hearts of the Game Informer staff are with everyone who's been affected by layoffs or closures.

[Source: The Verge]