Layoff fears are growing at Bungie after the studio ended development on Destiny 2, leaving developers facing an uncertain future as one of gaming’s biggest business bets begins to fall apart.
The reported cuts come as Sony struggles with a live-service gaming strategy that was once supposed to deliver years of reliable revenue but is now tied to failed launches, cancelled projects and mounting financial losses. According to reporting from Bloomberg journalist Jason Schreier, Bungie has no immediate plans for Destiny 3, while internal pitches for new projects have reportedly failed to secure approval.
For many Bungie employees, the problem is immediate. Destiny 2 is winding down, but there does not appear to be another major game ready to absorb large parts of the studio’s workforce.
Bungie is not alone. Studios hired aggressively during the pandemic gaming boom, when millions of people stuck at home poured money into online entertainment. When that boom faded, the spending slowed too. Borrowing costs climbed, growth cooled and publishers started cutting back.
Now some of the industry’s biggest companies are slashing jobs, shelving games and retreating from the expensive live-service model that dominated gaming for years.
Sony’s $3.6 billion acquisition of Bungie in 2022 was supposed to strengthen that push. Instead, the company has already recorded hundreds of millions of dollars in impairment charges tied to Destiny 2’s weakening performance.
The failures are piling up. Bungie’s upcoming shooter Marathon reportedly failed to meet expectations, while Sony’s multiplayer title Concord became one of the gaming industry’s most expensive recent disasters after collapsing within weeks of launch. Publishers spent years throwing money at giant online games. Now many are pulling back.
Big-budget titles can take close to a decade to build and cost hundreds of millions of dollars before generating revenue. Companies are becoming far less willing to take those risks after several high-profile flops.
Even developers working on globally recognized franchises are no longer guaranteed job security if player numbers weaken or revenue slows. For younger workers trying to break into gaming, the mood has changed sharply. What once looked like one of tech’s most exciting creative industries is now increasingly associated with layoffs, hiring freezes and cancelled projects.
Even Destiny 2 could not escape the slowdown.
The franchise helped define the modern live-service model and once dominated online gaming. But maintaining enormous development teams became harder as player numbers weakened and attracting new audiences became more expensive.
The Final Shape expansion briefly revived excitement in 2024 by concluding the game’s long-running story arc, but Bungie later admitted it was struggling to attract new players.
Across the gaming industry, thousands of jobs have disappeared since 2023 as publishers pull back from aggressive expansion plans made during the boom years.
Only a few years ago, live-service gaming looked like one of entertainment’s safest business models. Now it is producing layoffs, stalled projects and growing anxiety about whether the industry can keep supporting the enormous cost of modern blockbuster games.
