MONTREAL—Video game giant Electronic Arts is taking the axe to its Montreal office, laying off nearly two-thirds of the staff.

Named one of the worst employers in the United States over the past two years, the move came weeks after EA’s CEO resigned due to the company’s financial struggles.

The California-based gaming company has received a number of Quebec government subsidies. In 2010, the government agreed to cover 37.5 per cent of the labour costs at the studio, paying over $11,000 per employee.

Following the announcement that employees were being let go, workers leaving the EA Montreal office at Place-Ville-Marie were not in a chatty mood.

The company is not confirming how many workers have been laid off, but there are reports that almost two-thirds of its Montreal employees have been let go, nearly 170 bodies.

In a statement EA said: “These are difficult decisions to let go of good people who have made important contributions to EA. Streamlining our operations will help ensure EA is bringing the best next-generation games to players around the world.”

The company is one of the world's largest video game makers. The series developed at its Montreal office, most notably Army of Two, have been received with mixed reviews.

In 2005, the Quebec government gave the video game developer $600,000 to create new programs. Since then, the company has struggled financially.

Many of the lay-offs occurred within the mobile gaming division inside the EA Montreal offices, a move that surprised one tech expert.

“Mobile gaming is where the future is, so that's the most surprising thing,” said tech expert Elias Makos. “EA is putting a lot of focus in mobile and yet they're cutting Montreal’s mobile division.”

Makos says the video game industry is trying to meet demand for portable games at lower prices.

“I think we're going to see a bit of re-adjustment as industry goes from being able to charge $60 for a game you can play on your Nintendo to a 99 cent game.”

With a changing marketplace, conditions are putting the squeeze on Montreal’s gaming industry.