German developer Goodgame Studios is set to lay off around 200 staff in its latest round of redundancies.
The struggling Hamburg outfit already let go of some 400 employees last year but now plans to continue cutting staff.
An anonymous source speaking to Gamasutra revealed the latest round of cuts, which were announced by Goodgame MD Kai Wawrzinek in a studio-wide email.
Wawrzinek blamed the highly competitive nature of the free-to-play space, increasing marketing budgets and uncertainty of new successes as a key part of the decision.
“The market for free-to-play games is highly competitive and proves more and more challenging for all market players across the industry in Germany,” the e-mail states.
“The industry is fighting for market shares with rapidly increasing marketing budgets, the success of new games is increasingly difficult to predict. We are also affected by these developments. At the same time, our new developments have not yielded the desired success, yet.”
Founders Kai and Christian Wawrzinek will return to the positions of CEO and CSO moving forward. Current CEO Maximilian Schneider is expected to leave the company by the end of February.
According to Venturebeat, the company plans to invest millions in its HTML5 strategy, as well as refocus on its core brands such as Goodgame Empire, Empire: Four Kingdoms and Big Farm.
Update: Numerous reports in Germany claim that Goodgame aims to reduce the studio's headcount to around 350 staff. In 2016 the company employed as many as 1,200 people, meaning the string of layoffs could end with as many as 850 jobs lost once restructuring finishes.