Bungie Restructures with Significant Layoffs and New Sony Collaboration
Bungie has announced significant layoffs affecting 220 employees, citing rising development costs, industry shifts, and economic conditions. CEO Pete Parsons stated these layoffs, which impact 17% of the studio’s workforce, are necessary to refocus the company’s goals and financial health. Departing employees will receive severance, bonuses, and health coverage. Bungie plans to hold employee town halls and private meetings to discuss next steps, leaving 850 employees remaining.
“I realise all of this is hard news, especially following the success we have seen with The Final Shape,” Parsons writes. “But as we’ve navigated the broader economic realities over the last year, and after exhausting all other mitigation options, this has become a necessary decision to refocus our studio and our business with more realistic goals and viable financials.”
As part of its restructuring, Bungie plans to further integrate into Sony Interactive Entertainment (SIE), which acquired the studio in 2022. This integration will involve transferring 155 roles, about 12% of its staff, into SIE over the next few quarters, which Bungie claims will save additional talent from being affected by today's layoffs.
Additionally, Bungie is collaborating with PlayStation Studios to form a new in-house studio dedicated to developing an action game set in a new science-fantasy universe. This initiative aims to leverage the strengths of both companies and ensure continued innovation and quality in Bungie's projects.
Parsons elaborates on the factors leading to these decisions, explaining that Bungie’s goal was to develop three enduring global franchises while also setting up several incubation projects. This ambitious expansion quickly stretched the company thin, necessitating larger support structures than it could feasibly maintain, especially with the ongoing development of Destiny 2 and the upcoming Marathon.
The situation was further exacerbated by a broader economic slowdown, a downturn in the gaming industry, and the mixed reception to Destiny 2: Lightfall. Despite the critical acclaim of The Final Shape expansion, Bungie needed more development time for both it and Marathon to ensure high quality. “We were overly ambitious, our financial safety margins were subsequently exceeded, and we began running in the red,” Parsons states.
“After this new trajectory became clear, we knew we had to change our course and speed, and we did everything we could to avoid today’s outcome," Parsons writes. "Even with exhaustive efforts undertaken across our leadership and product teams to resolve our financial challenges, these steps were simply not enough.”
These layoffs follow a previous round eight months ago, where Bungie cut 100 staffers. This marks the second major layoff since Sony acquired the studio and reflects a broader trend of job cuts in the gaming industry over the past year. Bungie remains hopeful that the affected employees will find new opportunities soon.