Japan’s Bandai Namco Holdings Cuts Workforce in Cost-Cutting Measures

In a move to tighten its belt, Tokyo-based video game publisher Bandai Namco Holdings is sending employees to "expulsion rooms" – a traditional Japanese approach to reducing staff. The rooms, used to put pressure on employees to leave voluntarily, have already seen nearly 100 resignations since April.

Bandai Namco is canceling several underperforming titles, including mobile games featuring popular anime characters Naruto and One Piece, and a project commissioned by Nintendo. The company is also pausing development of several other games, including the big-budget online game Blue Protocol, which was set to launch in January.

The move is part of the company’s efforts to adjust to a post-pandemic drop in gaming enthusiasm, which has left some smartphone and online games in the red. Rival Square Enix Holdings has also canceled multiple loss-making smartphone titles, while Sony Group pulled the plug on online game Concord just two weeks after its launch.

A representative from Bandai Namco insists their goal is not to push employees out of the company, stating, "Our decisions to discontinue games are based on comprehensive assessments of the situation. Some employees may need to wait a certain amount of time before they are assigned their next project, but we do move forward with assignments as new projects emerge."

Founded in 1980, Bandai Namco is a well-known name in the gaming industry, with a history of iconic titles like Pac-Man and Gundam. However, the company is now facing mounting pressure to cut costs and adapt to changing consumer habits. With JPY 21 billion ($141 million or roughly Rs. 1,185 crore) in writedowns in the past three quarters, Bandai Namco is undergoing a major overhaul of its game title lineup.

As the company’s fortunes continue to shift, it remains to be seen how this new strategy will play out for the video game giant. One thing is certain, however: the gaming industry is in for a major shake-up.