Square Enix Lays Off Western Staff in Global Restructuring
If you’ve been watching the industry’s slow-motion collapse this year, here’s another gut punch: Square Enix is laying off staff across its North American and European publishing divisions. The company announced the cuts as part of a “fundamental restructuring” aimed at consolidating development in Japan and streamlining global operations. Translation? They’re pulling back from the West, and a lot of people are losing their jobs.
What’s Behind the Square Enix Layoffs?
According to internal presentations and statements to the press, Square Enix is restructuring its overseas publishing organization to “strengthen global publishing capabilities and improve operational efficiency.” That’s corporate speak for: we’re cutting costs, centralizing development, and reducing headcount. Same song and dance from other big companies recently.
The company expects to save over 3 billion yen (about $19.6 million) annually from the move. But the human cost is harder to quantify. IGN reports that 137 jobs are at risk in the UK, with an undisclosed number of layoffs in the US already underway.
What’s Changing Internally?
Square Enix is reducing its HD Games publishing divisions from 11 down to 4, and shifting development resources back to Japan. This follows earlier moves like selling off Crystal Dynamics, Eidos-Montreal, and Square Enix Montreal to Embracer Group in 2022. What’s left of the Western portfolio—Life Is Strange, Outriders, Just Cause, and Powerwash Simulator—will now be managed under a globally integrated structure.
In short: the West is no longer a development priority. It’s a distribution channel (ouch, that actually hurts).
What About AI?
While unrelated to the layoffs, Square Enix also announced plans to automate 70% of its QA and debugging work using generative AI by 2027. The company is partnering with the University of Tokyo’s Matsuo Laboratory to accelerate this shift. It’s part of a broader push to “optimize resource allocation” and “improve developer efficiency”—phrases that sound great until you realize they often mean fewer humans in the room.
How Is Square Enix Framing This?
In statements to Bloomberg and IGN, Square Enix called the layoffs “an extremely difficult decision” made after “careful consideration and analysis” to support long-term growth. They’ve promised to treat departing employees “with the utmost respect” and offer support during the transition.
But the timing—coming off a year of industry-wide cuts, studio closures, and AI adoption—makes it hard to see this as anything but another domino falling.
Final Word: Square Enix Is Shrinking Its Western Presence, and That’s a Big Deal
This isn’t just a budget trim. It’s an ongoing issue that’s been plaguing the gaming industry for a while,and it signals a major shift in how Square Enix sees its future. The company that once banked on global studios to expand its reach is now pulling back, consolidating, and automating. And while that might make sense on a spreadsheet, it’s a loss for the creative diversity that made Square Enix’s catalog feel global in the first place.
