Microsoft Xbox is closing a number of game studios, including Arkane Austin, making it the latest publisher to close studios amid a downturn in the games industry.
Studios such as Tokyo-based Tango Gameworks, maker of Hi-Fi Rush, and Canada’s Alpha Dog will also be closed and some employees will be laid off, Xbox Game Studios chief Matt Booty said in a statement to Reuters. became known on Tuesday.
Xbox declined to comment on the number of employees affected by the layoffs.
Sales growth for personal computer and console games is expected to remain below pre-pandemic levels as gamers log fewer gaming hours due to weaker release schedules, data from research firm Newzoo shows.
The “reprioritization of games and resources” is intended to allow Xbox to invest heavily in its games portfolio and new IP, Mr Booty said.
The affected studios are all divisions of ZeniMax Media, bought by Microsoft for $7.5 billion in 2021, and Bethesda.
Last month, Microsoft’s Xbox content and services segment reported third-quarter revenue growth of 62%, driven largely by its acquisition of Activision Blizzard.
Grand Theft Auto maker Take-Two Interactive said it will close two studios in a mass layoff, Bloomberg News reported last week.
Earlier this year, Microsoft already laid off 1,900 people at Activision and Xbox.
Some of Arkane Austin’s developers will join other studios and work on projects within Bethesda, the creator of The Elder Scrolls and Fallout.
The servers of Arkane’s Redfall game will remain online for players. (Reporting by Zaheer Kachwala in Bengaluru; Editing by Shunak Dasgupta)
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