News|Gaming News
By Drew Bryant
August 4th, 2024, theloadoutblog.com
On Wednesday, Bungie Studios, the creators of Halo and Destiny 1 & 2, announced significant layoffs, letting go of 17% of their workforce, amounting to 220 employees. These layoffs affected every level of the company, from entry-level to senior staff, including executives and senior leadership roles. This development has led many to speculate about the future quality of Bungie’s work and how the layoffs will impact the company moving forward. Bungie has offered generous exit packages to the affected employees, including severance, healthcare, and bonuses.
The staff cuts follow the successful launch of Destiny 2’s expansion, The Final Shape. CEO Pete Parsons acknowledged the layoffs were necessary, stating they were essential to “refocus our studio and our business with more realistic goals and viable financials.” Parsons also mentioned that the decision came after exhausting all other mitigation options, although he did not detail these alternatives in his message to employees.
In conjunction with the layoffs, Bungie is integrating 155 new roles, approximately 12% of their workforce, into their parent company Sony Interactive Entertainment over the upcoming quarters. This integration aims to retain talent that would otherwise have been affected by the reduction in force. This move implies that without Sony’s intervention, over 350 people could have lost their jobs, indicating that the actual layoff numbers might have exceeded 17%.
Simultaneously, Bungie is collaborating with PlayStation Studios to develop an action game set in a new sci-fi universe and to establish a new studio under the PlayStation banner. Parsons did not specify how many Bungie employees would transition to this new studio.
Before this massive restructuring effort, Bungie employed over 1,300 people. With the layoffs, role integration into Sony, and 75 employees leaving to start the new studio, the actual number of people leaving Bungie during this restructuring phase is approximately 34%.
In a press release, CEO Pete Parsons explained how Bungie arrived at this point, stating that the studio had been “running in the red” after exhausting its financial safety nets due to delays in The Final Shape expansion, Marathon, and the rapid expansion of the developer. After all the layoffs, restructuring, and departures to new studios, Bungie now employs over 850 people.
Press Release
This morning, I’m sharing with all of you some of the most difficult changes we’ve ever had to make as a studio. Due to rising costs of development and industry shifts as well as enduring economic conditions, it has become clear that we need to make substantial changes to our cost structure and focus development efforts entirely on Destiny and Marathon.
That means beginning today, 220 of our roles will be eliminated, representing roughly 17% of our studio’s workforce.
These actions will affect every level of the company, including most of our executive and senior leader roles.
Today is a difficult and painful day, especially for our departing colleagues, all of whom have made important and valuable contributions to Bungie. Our goal is to support them with the utmost care and respect. For everyone affected by this job reduction, we will be offering a generous exit package, including severance, bonuses, and health coverage.
I realize all of this is hard news, especially following the success we have seen with The Final Shape. 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.
We are committing to two other major changes today that we believe will support our focus, leverage Sony’s strengths, and create new opportunities for Bungie talent.
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.
This will be a time of tremendous change for our studio.
Let’s unpack how we ended up in this position; it’s important to understand how we got here.
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.
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. Even with exhaustive efforts undertaken across our leadership and product teams to resolve our financial challenges, these steps were simply not enough.
As a result, today we must say goodbye to incredible talent, colleagues, and friends.
This will be a challenging time at Bungie, and we’ll need to help our team navigate these changes in the weeks and months ahead. This will be a hard week, and we know that our team will need time to process, to ask questions, and to absorb this news. Today, and over the next several weeks, we will host team meetings and town halls, team breakout sessions, and private, individual sessions to ensure we are keeping our communication open and transparent.
Bungie will continue to make great games. We still have over 850 team members building Destiny and Marathon, and we will continue to build amazing experiences that exceed our players’ expectations.