Bungie, the developer behind Destiny 2 and the Halo franchise, is cutting a significant portion of its workforce due to disappointing game performance. Hermen Hulst, head of Sony’s studios, confirmed the layoffs in a memo to staff, noting that the reductions will primarily impact the team managing Destiny 2 and personnel working on the competitive shooter Marathon.
Why is Bungie reducing its workforce now?
The studio’s leadership cited underperformance as the primary driver for the staff reductions. According to a statement posted by Bungie on X, Destiny 2 has failed to meet expectations over recent years. Following the release of the game’s latest update in June, the studio stated it could no longer sustain its previous operational scale, especially while future projects remain in early development stages.
This is not Bungie’s first round of layoffs. In 2024, the Bellevue-based studio eliminated 200 roles, which accounted for approximately 17% of its total workforce at the time.
How does the performance of ‘Marathon’ impact studio stability?
Marathon, Bungie’s competitive shooter, has faced challenges since its launch in March. Hermen Hulst noted that the title has experienced a significant decline in audience engagement since its launch. Despite these struggles, the company maintains that Marathon remains an important part of its portfolio. The studio intends to continue supporting the team working on the game.
What is the broader trend for major game studios?
Bungie’s struggles mirror a wider cooling trend across the gaming industry, particularly among major publishers. Microsoft, a primary competitor to Sony, is also navigating a period of fiscal contraction. Asha Sharma, the president of the Xbox brand, stated in a June internal email that while Microsoft has invested over 20 billion dollars into its studio portfolio over the last five years, annual revenue has dropped by nearly half a billion on this period. She warned that the current situation cannot last, fueling industry-wide speculation regarding potential studio closures and further headcount reductions across the sector.
Industry Comparison: Financial Health
| Company | Observed Challenge |
|---|---|
| Bungie | Underperformance of Destiny 2 and Marathon engagement. |
| Microsoft (Xbox) | decline in annual revenue despite 20 billion dollars in investments. |
Investors often look at “average revenue per user” (ARPU) and “daily active users” (DAU) as the primary metrics for determining the long-term viability of live-service games like Destiny 2.
Frequently Asked Questions
- How many people are being laid off at Bungie?
The company has not released an exact figure, describing the cuts only as a “significant number” of employees. - Is Bungie still owned by Sony?
Yes, Sony acquired the Bellevue-based studio in 2022. - What will happen to the Marathon project?
According to Sony’s Hermen Hulst, the project remains an important part of the company’s portfolio and development will continue.
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