Bungie To Cut 17% Of Workforce Due To Rising Costs Of Development And Economic Conditions

Bellevue, Washington-based Bungie, a subsidiary of Sony Interactive Entertainment (SIE), has announced that it will lay off 220 employees, around 17% of its workforce. It is the second major reduction at the studio in less than a year, after 100 people were laid off last October.

The company cited “rising costs of development and industry shifts as well as enduring economic conditions” as the reason for the layoffs. As part of the restructuring, it will shift all of its development efforts onto two key franchises, the first-person shooter games Destiny and Marathon.

Laid off workers will be offered a “generous” exit package that includes severance, bonus, and health coverage.

Bungie also announced other a couple other major changes, including integrating a significant percentage of its staff into SIE to avoid laying off even more workers:

First, we are deepening our integration with Sony Interactive Entertainment, working to integrate 155 of our roles, roughly 12%, into SIE over the next few quarters. SIE has worked tirelessly with us to identify roles for as many of our people as possible, enabling us together to save a great deal of talent that would otherwise have been affected by the reduction in force.

Second, we are working with PlayStation Studios leadership to spin out one of our incubation projects – an action game set in a brand-new science-fantasy universe – to form a new studio within PlayStation Studios to continue its promising development.

In a letter from Bungie CEO Pete Parsons, published on the company’s website, the company head explained why the layoffs were necessary:

For over five years, it has been our goal to ship games in three enduring, global franchises. To realize that ambition, we set up several incubation projects, each seeded with senior development leaders from our existing teams. We eventually realized that this model stretched our talent too thin, too quickly.  It also forced our studio support structures to scale to a larger level than we could realistically support, given our two primary products in development – Destiny and Marathon. 

Additionally, in 2023, our rapid expansion ran headlong into a broad economic slowdown, a sharp downturn in the games industry, our quality miss with Destiny 2: Lightfall, and the need to give both The Final Shape and Marathon the time needed to ensure both projects deliver at the quality our players expect and deserve. We were overly ambitious, our financial safety margins were subsequently exceeded, and we began running in the red.