Midway To Lay Off 25% Of Staff, Austin Studio Closing

As if in response to the rumor posted earlier today, Midway has officially announced cost-reduction measures that including cutting 25 percent of staff and closing their Austin, TX studio.

Speaking to a Midway representative just moments ago, Kotaku learned that around 180 people lost their jobs today due to the cost-cutting measures, which includes the complete closure of Midway Austin, which was working on long-term projects not due out until 2010 or 2011. Workforce reductions affected Midway locations in Austin, San Diego, and Chicago.

“The cost-reduction measures are vital for us to rationalize our operations and provide the resources necessary for our core properties to succeed,” said Matt Booty, president and CEO of Midway. “These initiatives, along with the other steps we have taken this year, are a response to the specific challenges we are facing at Midway, many of which have been amplified by the current economic conditions.”

Those specific challenges of course include a tremendous amount of debt and the threat of delisting on the New York Stock Exchange. We wish the former Midway employees the best of luck. Hit the jump for the full release.

Midway Announces Cost-Reduction Measures
Actions include layoff of 25% of staff, closure of Austin studio, and suspension of several non-core projects

CHICAGO—(BUSINESS WIRE)—Midway Games Inc. (NYSE: MWY) today announced that the company is taking significant steps to reduce its cost structure, including a reduction in workforce, the closure of its Austin, TX, studio, and the suspension of development on several non-core games.

The cost-cutting initiatives will involve a reduction in force across multiple disciplines within the company in its Austin, Chicago and San Diego locations. Headcount will be reduced by approximately one quarter of Midway’s global workforce. The suspended non-core projects were previously scheduled to release in 2010 or 2011 and have not yet been made public.

“The cost-reduction measures are vital for us to rationalize our operations and provide the resources necessary for our core properties to succeed,” said Matt Booty, president and CEO of Midway. “These initiatives, along with the other steps we have taken this year, are a response to the specific challenges we are facing at Midway, many of which have been amplified by the current economic conditions.”

Additional details on the reduction and the financial impact can be referenced in the report filed today on Form 8-K with the Securities and Exchange Commission.