While absolutely another instance of gruesome bloodletting for the video game industry, 2025 at least had fewer layoffs than the prior year. 2026, on the other hand, is off to a terrible start.
Today three major companies announced layoffs in some capacity, beginning with Meta, which shut down Sanzaru, Armature, and Twisted Pixel – all VR studios. The first worked on Asgard's Wrath 2, an award-winning game, while the latter is fresh off releasing Deadpool VR in November. The studios are victims of Mark Zuckerberg’s predictably disastrous overinvestment in VR and the metaverse, with roughly 10% to 15% of Reality Labs' 15,000 employees also set to be laid off, according to The New York Times.
“We said last month that we were shifting some of our investment from Metaverse toward Wearables,” a Meta spokesperson said in a statement to Kotaku. “This is part of that effort, and we plan to reinvest the savings to support the growth of wearables this year.”
Ubisoft also announced more layoffs today – its second round in as many weeks, a time period that constitutes the entire year. Following a “voluntary transition program” at Division, Star Wars Outlaws, and Avatar: Frontiers Of Pandora studio Massive Entertainment, the company decided to finish the job with an old-fashioned slash-and-burn treatment, eliminating approximately 55 roles at the Malmö, Sweden-based Massive, as well as Ubisoft Stockholm.
"This restructure follows the completion of the Voluntary Leave Program launched during the fall of 2025, a finalized long-term roadmap, and a completed staffing and appointment process, which together have provided clearer visibility into the structure and capacity required to support the two studios’ work and sustainably over time,” a company rep told IGN, noting that The Division will be the studios’ primary focus going forward. “These proposed changes are forward-looking and structural, they are not related to individual performance, recent deliveries, or the quality of the work produced by the teams.”
Lastly, former Xbox hype man Larry “Major Nelson” Hyrb, an industry veteran, announced that he’s been laid off from Unity after joining the cut-happy company in 2024.
"Like many in the gaming space recently, I've been laid off from Unity," he said on Bluesky. "I am proud of the goals my team and I accomplished in just 18 months, and I am grateful for the creators and teams I had the chance to support. Now, I am excited to explore the next chapter."
It is unclear if Hyrb's dismissal is part of a larger wave of layoffs at Unity.
This marks a rough beginning to the year for game workers, especially following yesterday’s news that Rockstar workers who alleged they were fired unjustly amid a unionization push won’t have their pay restored during mandatory legal proceedings. However, small silver lining: IWGB, the union representing the workers in the upcoming tribunal, still believes that it will win out in the end.
“Despite being refused interim relief today, we've come out of last week's hearing more confident than ever that a full and substantive tribunal will find Rockstar's calculated attempt to crush a union to be not only unjust but unlawful,” IWGB president Alex Marshall said in a statement published today. “Over the course of the two-day hearing, Rockstar consistently failed to back up claims made in the press or to refute that they acted unfairly, maliciously, and in breach of their own procedures. … This hearing could have alleviated the hardships faced by those in financial precarity or forced to leave the country as a result of Rockstar's actions but we remain undeterred in our efforts to hold them to account.”
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Luke Plunkett
