EA has told debt investors it will cut $700 million in annual costs, including $170 million in "organizational efficiencies," days after completing an $18 billion leveraged buyout led by Saudi Arabia's Public Investment Fund, according to Bloomberg reporter Jason Schreier.

The cuts point squarely at the studio workforce. "EA's annual Ebitda is around $1.5 billion, which should be enough to service the interest payments," Schreier wrote on Bluesky. "But the publisher has told debt investors that it will cut $700 million in annual costs including $170 million in 'organizational efficiencies,' per Bloomberg. In other words: mass layoffs."

How big is the debt burden?

The buyout places roughly $18 billion of debt on EA. Annual interest runs around $1.8 billion against EBITDA near $1.5 billion. That arithmetic leaves nothing for principal repayment and locks in cost cutting as the primary lever for years. Coverage depends on reductions landing fast enough to widen the EBITDA-to-interest gap before the next refinancing window.

What just changed at EA?

The transaction closed Tuesday, August 5, and ranks as the largest leveraged buyout in history. PIF owns 93.4% of the investor consortium; Silver Lake and Affinity Partners take the remainder.

The fund already holds significant stakes in Take-Two Interactive and owns fighting-game publisher SNK outright. The deal anchors PIF's entertainment M&A inside Saudi Crown Prince Mohammed bin Salman's push to diversify the kingdom's economy beyond oil.

Has EA cut staff before?

Yes — repeatedly. Reuters reported EA laid off 300–400 staff in April 2025, including roughly 100 at Respawn Entertainment, and cancelled a Titanfall game.

EA confirmed additional, undisclosed layoffs across the four studios building Battlefield 6 — Criterion (Guildford), Dice (Stockholm), Motive (Montreal), and Ripple Effect (Austin) — in March 2026.

The pattern matters: the new $700 million target lands on a workforce already trimmed twice in 18 months and stripped of at least one major live project.

What does the math actually look like?

• Total debt: ~$18 billion
• Annual interest: ~$1.8 billion
• EBITDA: ~$1.5 billion
• Target cost cuts: $700 million, with $170 million earmarked for "organizational efficiencies"
• Stated mechanism: layoffs plus operational restructuring

Those figures imply cost reductions equal to roughly 47% of EA's current EBITDA. Hitting the target would lift EBITDA toward $2.2 billion and leave a thin cushion against rising rates or a soft sports-game cycle. Missing it puts covenants at risk.

Which studios are most exposed?

EA has not publicly named targets. The Battlefield 6 dev cluster has already absorbed cuts, so further reductions would likely hit Respawn (Los Angeles), Maxis, and BioWare (Edmonton).

EA Sports campuses in Vancouver, Madrid, and Bucharest, plus central marketing, QA, and localization functions, typically absorb disproportionate cuts in LBO restructurings. Contractors, particularly in cinematics and mocap pipelines, are usually first.

What's next to watch?

EA has not confirmed the $700 million figure or named affected teams. Watch the next quarterly earnings call, scheduled for late August, and any 8-K filings for severance accruals, studio closures, or project cancellations tied to the new capital structure. Debt-investor presentations typically precede formal restructuring announcements by 30–90 days.