(Bloomberg) -- Tencent Holdings Ltd.'s Riot Games plans to lay off 530 employees, with management saying in a memo that the video-game maker has too many projects and too little focus.
The cuts, which amount to about 11% of staff, were announced Monday in a blog post and letter to employees.
“This isn't to appease shareholders or to hit a quarterly earnings number — it's a necessity,” the maker said in the post, acknowledging it had “more than doubled in headcount” over the last several years.
Chief Executive Officer Dylan Jadeja said in a memo that Riot has made “a number of big bets across the company,” including new games. But some of those projects have diverted resources. For its first 14 years, the company primarily operated , still one of the most popular games of all time.
“Today, we're a company without a sharp enough focus, and simply put, we have too many things underway,” Jadeja said.
Riot, based in Los Angeles, will reduce the size of the team, acknowledging the game hasn't performed as well as hoped.
New development work from Riot Forge, an internal game development subsidiary, will end after the February release of .
“Forge was an experiment to see what would happen when Rioters partnered with their favorite” independent developers, the blog post reads. “We're proud of what we've done together to bring these stories to life, but it's time to refocus our efforts on the ambitious projects underway internally at Riot.”
Other companies in the video-game industry have been cutting jobs in recent weeks, including Unity Software Inc. and Amazon.com Inc.'s Twitch.
Riot is offering affected employees a minimum of six months' salary, a cash bonus, career support and “even a personal computer if they do not possess one.”
--With assistance from Jason Schreier.
(Updates with comment on Riot Forge in eighth paragraph, severance terms in last paragraph.)
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