Testronic makes 4.8 percent of its total workforce redundant, closes Madrid and Belgrade studiosTestronic makes 4.8 percent of its total workforce redundant, closes Madrid and Belgrade studios

After multiple reports and accounts from employees since July, Testronic has confirmed that it's shuttering its Madrid and Belgrade studios.

Via a press release issued earlier today, the company announced an internal restructuring, which includes a number of senior hires to "strengthen its leadership team," as well as securing "significant" new investment to "accelerate growth and future-proof its worldwide operations." Regarding the latter, a Testronic spokesperson told Game Developer that they're unable to share investment data and disclose the figure.

At the same time, Testronic confirmed that—as part of the restructure—the company has closed down its studios in Madrid and Belgrade, while the Catalis Group name has been "retired." The Testronic spokesperson said the redundancies affected 4.8 percent of "the total workforce." 

The press release also mentions the acquisition that took place in May of this year, when Indian esports and mobile game company Nazara Technologies bought Dungeons of Hinterberg publisher Curve Games for an undisclosed amount. The company says the sale has "enabled Testronic to simplify its structure," which includes streamlining the business to "eliminate what had been something of a complicated corporate structure."

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Testronic, however, seems confident in its future and plans to continue recruiting new people. "This is a pivotal moment for our company," Testronic CEO and executive chair Sharon Baylay-Bell said in the announcement.

"Making changes that affect people is never easy, but these decisions are about strengthening our business for the future," Baylay-Bell added. "We are in a very strong financial position, and this refocus allows us to invest more deeply in our Centers of Excellence in the US, Europe, and South East Asia. We are recruiting across all three regions, and remain committed to innovation and state-of-the-art technology."

Reports about the studio closures began in July

At the start of July, Game Developer reported on multiple employees mentioning the closure of Secret 6 Madrid, less than three years after it was purchased by Testronic and parent company Catalis Group. Back then, the lead game producer said the studio was potentially winding down on July 31, and that it could reportedly affect 42 people. Other devs corroborated those reports via LinkedIn.

"Our Madrid local management team had no idea and was equally astonished," the studio's art manager said on LinkedIn at the time. "Testronic, a subsidiary of Catalis group, acquired our company, Secret 6, in the last quarter of 2022. And since then, they have done nothing. They watched us in the most absolute of silences—and they let us die."

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A few days later, employees at Secret 6 Madrid accused Testronic of "wildly violating" their labor rights by intentionally sabotaging the outsourcing studio and its workforce to justify an impending studio closure. The developers also issued a press release with backing from the Spanish labor union CGT, which includes numerous accounts of frustrations about company decisions around contract work, management mandates, and more.

Then, workers at Secret 6 Madrid expressed an intention to strike unless Testronic committed to compensating employees that it reportedly planned to make redundant. Shortly after, Secret 6 Madrid leadership informed Game Developer that the studio had called off its strike after agreeing on severance terms with Testronic.

The news confirmed the studio would effectively shutter on July 31, as previously reported, although Testronic repeatedly avoided commenting on or confirming the matter.

"Although the negotiation has been tough, and despite the multiple divisive tactics used by Testronic's legal representatives, the team stood firm and refused to leave anyone behind, especially those in more vulnerable positions, even when that meant turning down significantly better conditions for most," a studio member said in a statement to Game Developer.

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"That speaks volumes about each and every one of them, and I'm proud to be part of this team."

Game Developer has reached out for additional information on the matter.