Unity Software is eliminating 3.8 percent of its global workforce and terminating an agreement with VFX company Weta as part of a "reset," Reuters has reported. The news follows some severe turbulence in the company, after it imposed and then partially walked back a controversial runtime fee for its game engine. Last month, John Riccitiello stepped down as president and CEO of the company after nine years in leadership.

Some 265 employees will be laid off, all related to Unity's professional services agreement struck as part of its purchase of Weta Digital's technology and engineering division back in 2021. Employees will have only a week to wrap up before their positions are fully terminated, according to FX Guide — a tough blow just before Christmas. In a statement, Weta FX said it will extend offers to as many affected employees as possible.

Unity will close offices in up to 14 locations including Berlin and Singapore, pending consultation with employees in some locations, while reducing its office footprint in San Francisco and Belleview, Washington. The company will no longer require that employees work from offices three days a week and will reduce "full in-office services" to three days a week.

After Unity's acquisition, Weta FX (the film industry VFX division) split off into a new and separate company. Unity, meanwhile, acquired Weta engineers along with tools for pipelines and FX, Weta's data platform, a library of assets and more. "Unity will retain ownership of the technology it acquired from Wētā in December 2021 and will be evaluating the best way to enhance its offerings with it over time. The technology will also remain fully available to Weta FX," Weta said in a statement.

Just a month ago, Unity rolled out some significant concessions to its developer pricing model after widespread backlash over its plan to charge developers for game installations. The move will directly impact developers, publishers and distributors. The upheaval of Unity’s business model came at the same time as a series of massive layoffs. In 2023, the company reduced its headcount three times in an attempt to cut costs. CEO John Riccitiello, who took much of the brunt of the criticism, stepped down last month and was replaced by former IBM president James Whitehurst, who is serving as an interim CEO.