Rovio, the Finnish maker of the popular mobile game "Angry Birds" announced on Thursday up to 130 job cuts, blaming flagging sales growth.
The company has been trying to expand beyond the video games business to become a global entertainment firm, opening amusement parks in Europe and China, publishing children's books and producing feature films.
"We have been building our team on assumptions of faster growth than has materialised," Rovio chief executive Mikael Hed said in a statement, adding that the company would now focus on games, media, and consumer products with the highest growth potential.
"Unfortunately, we also need to consider possible employee reductions of a maximum of 130 people in Finland (approximately 16 percent of workforce)," he said.
The company's workforce grew by 300 people last year to total 800 employees.
The "Angry Birds" series of games use slingshots to launch little birds at fortresses built by green pigs.
It quickly became the most successful mobile game in history, spawning an entire franchise of merchandise and media tie-ins.
Sales of Angry Bird spin-off products accounted for 47 percent of Rovio's total revenue in 2013.
Rovio has established a movie animation production team in the United States and the first Angry Birds feature film is expected to premiere in 2016.