Earlier this week, it was revealed that Sentinels is suffering from a huge financial crisis and might shut down operations soon. Later, reports claimed that VCT Americas teams could be downsizing their spending in Valorant for 2024. Multiple North American organizations are expected to reduce their operational costs in Valorant for the VCT Americas League.
The claim that esports isn't profitable is being bolstered by the fact that some organizations did incur huge amounts of losses to just keep things afloat. However, recent findings also show that with some changes, Valorant could turn profitable soon.
Also read: Valorant Champions 2023 Day 4: PRX, EDward And FNATIC Emerge Victorious
VCT Americas Teams To Downsize Spending In 2024
Esports is currently in its winter season. Mass layoffs have become common news at this point. Among companies partaking in mass layoffs recently, 100 Thieves and The Guard are two of the most famous esports organizations in North America. Back in March, Cloud9’s CEO Jack Etienne announced the departure of Yay and Vanity from the roster due to financial issues and restructured their roster with some lesser-known players. Players from VCT Americas are rumored to have a minimum salary of $50,000 per month. What’s interesting is the fact that pre-franchising, players from the NA region demanded salaries of over $30,000 per month.
With such huge salaries, the esports industry crumbling under its own standards. Teams are expected to generate a lot of revenue with in-game items like skins and other cosmetics. However, the revenue generated solely from that won't be enough to act as a pillar for the finances. It could only be a matter of time before teams start reconsidering their decisions and back off from the League. With professional organizations from NA looking forward to reducing their spending, it will be an interesting transition where VCT restructures itself to be sustainable.