Avalanche Studios Shuts Down Liverpool Office After Contraband Game Cancellation; Layoffs Impact Malmö and Stockholm Teams

Avalanche Studios Announces Layoffs and Closure of Liverpool Branch

Avalanche Studios has made a significant announcement regarding staffing changes across its locations in Malmö, Stockholm, and Liverpool. The Liverpool branch will be permanently closed, resulting in the layoff of all its employees. This decision follows the recent cancellation of Contraband, an Xbox exclusive project that had been in development since 2021, as part of substantial workforce reductions at Microsoft earlier this year.

A Studio Update from Avalanche Studios Group discusses structural changes and potential Liverpool studio closure. — Just Cause developer Avalanche Studios closes its Liverpool branch.

Official Statement and Future Plans

In a statement released on its website, Avalanche Studios acknowledged the current challenges facing the industry. They stated, “In light of current challenges to our business and the industry, we have thoroughly reviewed how to best ensure Avalanche Studios Group’s long-term success.”This careful evaluation has led to the difficult decision to restructure staff and locations.

The announcement outlined that the Liverpool studio would close as part of a collective consultation process mandated by UK law. Employees in Malmö and Stockholm will also experience workforce reductions and team restructurings to better align with the studios’ gaming objectives. They emphasized their commitment to supporting all employees during this transition, stating, “Despite these changes, we remain deeply committed to providing amazing games to our passionate player communities.”

Impact of Microsoft’s Layoff Wave

The news comes on the heels of Microsoft’s significant layoffs, which affected over 9, 000 employees in July, as the company shifted focus toward AI initiatives. While it was unclear whether Contraband had been impacted by these cuts—affecting other high-profile games like Perfect Dark and Everwild—the game’s trailer being marked ‘private’ on the Xbox YouTube channel signaled trouble ahead.

Current Situation and Developer Concerns

Prior to the cancellation of Contraband, concerns arose as Avalanche Studios laid off staff while still developing the title. With the project now officially discontinued and the Liverpool branch facing closure, the outlook appears grim for the future of Avalanche Studios. The total number of developers affected by the layoffs and specifics regarding the Liverpool studio’s workforce have not been disclosed. However, the studio’s website indicates a collective total of around 600 developers across its different locations.

As the gaming industry continues to navigate profound changes, the situation at Avalanche Studios serves as a snapshot of the broader challenges facing developers today. The support and strategies that the studio employs to assist its remaining workforce will be critical in the coming months.

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