Venture capital funding for the games industry collapsed from $28 billion in the first half of 2022 to $0.9 billion in the first half of 2023.
Major organizations including Epic Games, Creative Assembly, and Team 17 implemented significant layoffs in October 2023 as part of a broader industry-wide contraction.
The industry is suffering from a 'perfect storm' caused by high inflation and rising interest rates, which have increased headcount costs and stifled investment.
Pandemic-era business decisions led to a 'traffic jam' of delayed releases, resulting in intensified market competition and forced price reductions.
Significant capital was lost due to over-investment in speculative sectors like the metaverse and Web3 that failed to yield expected returns.
The industry is undergoing a period of forced restructuring and consolidation, with potential for recovery contingent on disciplined financial management and upcoming 2024 hardware cycles.
That's the gist.
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