Jurassic World Alive and Harry Potter: Hogwarts Mystery publisher Jam City laid off 17% of staff at the company and its subsidiary Ludia on Thursday. Jam City, which created match-3 game Cookie Jam in 2014 and has locations across the U.S. and Canada, acquired Ludia, located in Montreal and known for creating both original and licensed games, in 2021 and together they employ around 1,400 workers.
About 200 workers were laid off between Jam City and Ludia on Thursday. Polygon spoke to 10 affected Ludia workers and three current employees. Multiple former employees at Ludia told Polygon they were either on leave or vacation when they were laid off, finding out first from other coworkers and then noticing they’d lost access to associated accounts.
Ludia workers who were not laid off were notified first at a large meeting, where employees were instructed not to tell others, according to a recording of the call obtained by Polygon. Later, human resources started pulling the impacted individuals into separate meetings. At least one worker told Polygon they started losing access to their various work accounts while they were still waiting for their scheduled meeting time. Other confused employees began questioning the layoffs in public Slack rooms.
The majority of workers said they were surprised by the layoffs, noting they’d been promised previously that it wouldn’t happen — and that the Jam City acquisition would let Ludia do more of what it already does. “People are really upset,” one current employee told Polygon. “Ludia’s treated us very well over the years. They’ve done a lot to try to take care of us, but since the acquisition, that attitude seems to be changing. We’ve tried to have our voices heard, but we’ve, in general, seemed to be ignored. We feel voiceless.”
Jam City purchased Ludia for $165 million in September 2021 after securing $350 million in funding from South Korean game company Netmarble, Marvel Realm of Champions developer Kabam, and others, according to VentureBeat. Jam City has issued a few smaller rounds of layoffs between then and now, four former employees told Polygon. Thursday’s layoff, however, is by far the largest of them all.
A Jam City spokesperson told Polygon that the decision was made “in light of the challenging global economy and its impact on the gaming industry.” The spokesperson continued:
In light of the challenging global economy and its impact on the gaming industry, Jam City has made the difficult decision to reduce the size of our team by about 17 percent. In recent years, we have made a number of strategic acquisitions, and this move represents a right sizing of our work force to address redundancies associated with those transactions. While Jam City remains profitable, we believe that in the current operating environment, this is a necessary move to enhance our financial flexibility and increase operating efficiencies, better positioning Jam City for long-term growth. This also follows a broader restructuring we recently completed to realign our development teams under genre divisions focused on subject-matter expertise to optimize performance. We thank those who are leaving us for their many contributions and are providing severance packages and benefits to help with the transition.
Workers were given severance packages whose value increases according to the time they were employed by the company, they said. Jam City reiterated the severance package and other support for laid off workers in an email to staff sent Thursday afternoon. Cofounders Chris DeWolfe and Josh Yguado said the company would also extend healthcare benefits for impacted employees. DeWolfe and Yguado also confirmed that Jam City has nearly 1,400 employees across its global studios — up from 700 just a couple years ago.
“While we’ve strengthened our business and games portfolio with amazing teams and titles like Disney Emoji Blitz, Bingo Pop, and Jurassic World Alive, we have also absorbed a number of redundant roles throughout the company.”
Wolfe and Yguado also said that Jam City has canceled its upcoming mobile game HGTV My Design, which had been in development for almost three years.
Jam City was founded in 2010 by MySpace cofounders DeWolfe, Colin Digiaro, and Aber Whitcomb, alongside 20th Century Fox executive Yguado. Jam City has worked on a number of licensed and original games, like Genies & Gems, Disney Emoji Blitz, and Family Guy: Another Freakin’ Mobile Game. The company publicly detailed its next game, which is called Champions Ascension and will be built on the blockchain, in a white paper in May. Champions Ascension characters can currently be purchased as NFTs on OpenSea; 7,622 are available as of writing. Some of the laid-off workers speculated to Polygon that Jam City’s all-in approach to blockchain gaming may have influenced the layoffs Thursday.
Ludia, which was founded in 2007, began by creating licensed games like The Price Is Right and other game show brands, and moved into other games like The Bachelor: The Videogame and Jurassic World Alive.
Jam City originally announced its intention to purchase Ludia and go public through a special purpose acquisition company (SPAC) in May 2021. The deal was valued at $1.2 billion, according to Venture Beat. However, Jam City nixed that plan months later in July 2021, due to “current market conditions.” Jam City ended up purchasing Ludia in September 2021 in the $165 million deal, but did not go public with the merged company.
“The problem that comes with a lot of game development is that we have so much nondisclosure,” one worker said. “It’s difficult for these things to get out without feeling like you’re at risk. If you’re able to speak out about these sorts of layoffs, let people know this is happening. Otherwise it just goes under the radar. Game development is just going business as usual. But in a city like Montreal, where there’s such a concentrated number of studios, it can be devastating.”
Update (Aug. 5): This story has been updated to include further context and a new email from Jam City co-founders Chris DeWolfe and Joshua Yguado.