While gaming sales are breaking records, the coronavirus pandemic is impacting the gaming industry with delays, scope cuts, and serious production challenges
The coronavirus pandemic is offering mixed news and new challenges for gaming companies, both independent and corporate.
New York TimesJason Schreier
Context & Ripple Effects
April 2020 splits the games business in two: demand is exploding while production stalls. Two weeks after this report, Activision Blizzard beat Q1 expectations with $1.52B in sales, up 21% year over year, confirming that stay-at-home players are a revenue windfall even as remote work slows development pipelines.
The tension this article names — record sales on one side, delays and scope cuts on the other — became the industry's defining arc for years: 2020 drew $10.3B in M&A deals versus $7.8B the prior year as capital chased the boom, while the Cyberpunk 2077 debacle showed what strained, disrupted production does to releases at the other end.
First-order effects
Publishers face a squeeze between surging player demand and slipping release calendars — delays and scope cuts push revenue into future quarters right when engagement, and live-service monetization, is peaking.
Second-order effects
Capital consolidates around the winners: the 2020 M&A and investment surge shows buyers paying up for studios with shipped catalogs rather than betting on pipeline titles that pandemic-disrupted development puts at risk.
Third-order effects
The pattern hardens into a structural split visible by 2023-24, when deep layoffs, weak revenue growth, and declining VC investment followed the record-sales years — proving that demand-side booms do not protect development jobs, which get cut once the engagement spike normalizes.
The trend: Gaming's crisis-era economics decouple player spending from studio health: engagement and revenue spike during disruptions while production capacity and headcount contract afterward.
Following the temporary closure of KOJIMA PRODUCTIONS, we have had to delay the PC launch of DEATH STRANDING to July 14, 2020, to allow more development time amidst the current work-from-home orders in place. Thank you all for your patience and continued support! #keeponkeepingon…
@sexualjumanji
Feral Gamer on x
another brick in the wall https://twitter.com/...
@nfritanga
NotFritanga on x
I love how the comments section is a bunch of PC gamers being kind and understanding and patient lol. The complete opposite of ponies. https://twitter.com/...
@ohnoitsalexx
@ohnoitsalexx on x
Although I'm sad the game is delayed, and I was looking forward to playing it again on PC, I don't mind the wait. I'd rather have a competent port and a better experience. https://twitter.com/...
@glassbottommeg
Megan Fox on x
This pretty much mirrors my own experience / the experience of Glass Bottom Games. Especially this bit. 80% productivity sounds about right, in aggregate. https://twitter.com/... https://twitter.com/...
@markmacd
Mark MacDonald on x
Great story; I'd add two other factors that are / will impact: 1. Ratings: ESRB and PEGI are slowed, Japan's CERO ratings are halted altogether (!) 2. User testing: a lot harder (sometimes impossible) to do remotely, especially at scale. These are -key- to polish, usability, etc.…
@cam_rogers
Cam Rogers on x
It has been a challenge transitioning to f/t WFH, and I remain profoundly grateful that I'm with a company that handled it with such conscientiousness and aplomb. @DigitalExtremes is a class outfit. https://twitter.com/...
@cynixy
Anna Megill on x
I'm lucky that I can work from home & that Massive supports my team so well. Especially when so many of my colleagues & friends have lost their jobs. (Rival's closing was awful.) But even privileged as I am, I'm emotionally drained & stressed & hell yeah it's affecting my work ht…
@nalvaratv
Nalvara on x
Beyond the big game delays, it's crazy to think about how video game development is being impacted in ways that, as gamers, we may not be aware of (unannounced games being canceled, features getting cut, production challenges, etc). https://twitter.com/...
@jorraptor
@jorraptor on x
Very interesting read! Ubisoft found it easier to adapt because their studios in China ‘shared their best practices and experiences with us.’ Devs can work on next-gen games from home, but Ubisoft is willing to delay those games if the consoles miss the fall. More at the link htt…
@bexsaltsman
@bexsaltsman on x
Even remote based teams are slowing down- the sheer mental capacity of this takes its toll. @FinjiCo is built to handle this isolation- but even we built in 8-10 week delays on all current projects to keep our teams healthy. https://twitter.com/...
@emilyg
Emily Greer on x
The New York Times article on video games in Covid interviews only console/PC game developers and only mentions console/PC titles. Hey guys, news flash: mobile games are half the industry revenue and way more than half the players. Don't erase us. https://www.nytimes.com/...