PlaySide Studios (ASX: PLY) has announced a restructuring of its operations, primarily impacting its Work for Hire teams and non-project-specific workforce. This move comes in response to previously announced delays in securing anticipated Work for Hire contracts, leading to excess staff capacity. Despite remaining optimistic about securing new contracts, the timing remains uncertain, prompting the company to optimize its cost base. The proposed redundancies are expected to yield annual cost savings of $4-5 million, offset by an upfront restructuring cost of approximately $1.5 million to be incurred in the June quarter.
Importantly, PlaySide emphasizes that this restructuring will not affect the progress of its major Original IP projects, including MOUSE: P.I. for Hire and the Game of Thrones real-time strategy game, along with their Dumb Ways to Die console title. The company remains committed to fully capitalizing on these opportunities, anticipating high levels of cash flow generation from FY26 onwards, which will support sustainable growth.
While PlaySide continues to negotiate several Work for Hire contract opportunities, the focus is now shifting towards bolstering its balance sheet through successful Original IP launches. The company has reaffirmed its FY25 guidance, projecting revenue of $50-54 million, an EBITDA loss of $6-10 million, and a closing cash balance of $10-15 million. PlaySide CEO Benn Skender acknowledged the difficulty of the decision and emphasized the company’s commitment to building resilience into its business model.
The announcement outlines PlaySide’s strategic shift towards prioritizing its Original IP, which is expected to provide a stronger financial foundation for the company’s future. The cost savings resulting from the redundancies will be crucial in supporting the development and launch of these key projects.
