this post was submitted on 07 May 2025
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It's true, there are outliers like that. But if you're looking at shutdown studios or massive layoffs at random, it's going to generally be because the game they made lost money. In Hi-Fi Rush's case, to the best anyone can tell, it's because Satya Nadella changed the direction of Microsoft at a time when Tango Gameworks was starting a new project, which means there's the least sunk costs on a project that was going to be several years away from returning a profit.
A small portion of the Rivals team was laid off for similar reasons to Hi-Fi Rush in that the CEO changed the direction of the company. This would still be an outlier compared to the rest of the industry. Respawn got hit with layoffs because their live service isn't making anywhere near as much money as it used to, and live services need to keep making tons of money to justify new content for them; yes, this is wholly unsustainable. A live service team getting laid off has nothing to do with whether or not it was a hit and everything to do with whether or not it's still a hit.
I'm disagreeing with the idea that Hi-Fi Rush and the one branch of the Marvel Rivals team being let go are a regular occurrence. In general, teams are being let go because their games aren't making money. Their games aren't making money because there are too many games out there that are also spending too much money on their production, and they're being subsidized by a consumer base that's stretched too thin to make it all work for everyone that was in the industry as little as 3 years ago.
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