In the worst two years for the gaming industry, and in yet another bloodbath, Bungie announced that it is laying off 220 employees, or roughly 17% of its workforce, at "all levels of the company, including most of the executive and senior leadership positions."

In a blog post titled "The New Path for Bungie," Bungie CEO Pete Parsons said, "Due to rising development costs, industry shifts, and persistent economic conditions, it has become clear that our cost structure needs to change significantly." and announced that the studio's development focus will shift entirely to Destiny and the upcoming extraction shooter Marathon. The new layoffs come less than a year after Bungie's last job cuts in October 2023, which included veteran "Halo" composer Michael Salvatori among its victims.

Bungie described the whole situation as a bloody but necessary pivot for the company, a decision necessary to "refocus" its overstretched studios. According to Parsons, Bungie's goal for more than half a century was "to ship games in three enduring, global franchises." To that end, the studio "launched several incubation projects, each seeding senior development leaders from existing teams," but "this model stretched our talent too thin and too fast," and led to a "Destiny" and "Marathon" already The company came to realize that this model "stretched our talent too thin and too quickly" and placed an undue burden on the studio's support structure, which was already preoccupied with Destiny and Marathon.

The company also cited the "rapid expansion" of 2023 as a factor that led to the layoffs, which "was driven by the widespread economic slowdown, the sharp downturn in the gaming industry, the quality failure of Destiny 2: Lightfall, and the need to give both The Final Shape and Marathon the time they needed to The company states that it "ran headlong into the need to give both 'Final Shape' and 'Marathon' the time they needed." We were overly ambitious and our financial margin of safety was subsequently exceeded and we ran at a loss."

The company's "financials were not in the best of shape.

This means that 220 people lost their jobs, but it is currently unclear how many (if any) of them were involved in the decision to clearly overstretch the studio.

The second part of the "new path," which, in Bungie's defense, should have been much higher, is that the studio will "deepen its integration with Sony Interactive Entertainment, integrating 155 people, or roughly 12% of its roles, into SEE in the next few quarters." This decision appears to have saved "many personnel who would otherwise have been affected by the cutbacks."

The studio will also spin out one of its aforementioned incubation projects and "establish a new studio within PlayStation Studios to continue its promising development." This will be an "action game set in an all-new science fantasy world."

One has to imagine that all of this is no comfort to the 220 people who currently have to find new jobs, but Bungie says it will at least offer those affected "a generous severance package, including severance pay, bonuses, and health insurance."

Destiny 2's "Final Shape" expansion was by all accounts an example of the studio going all out. It is also familiar news that invites despair. The gaming industry is more volatile and feverish than ever, and even historically successful studios can't seem to escape the mountain of layoffs that have devastated them over the last two years. Developers are increasingly living under the knife, and it doesn't look like it will stop here.