Avalanche Studios, the developer behind the beloved Just Cause series, has announced a series of significant staff reductions across its Malmö and Stockholm studios, along with the proposed closure of its Liverpool office. This move will unfortunately affect all of the company’s UK employees.
This difficult news comes only a month after Xbox officially canceled Contraband, Avalanche’s ambitious open-world co-op game that had been in development since at least 2021. The cancellation of Contraband itself followed a wider trend of mass layoffs at Microsoft in July, which saw 9,100 jobs eliminated and other Xbox projects, like Everwild and Perfect Dark, also halted.
While Avalanche’s official statement on its website didn’t directly attribute the layoffs to Contraband’s cancellation, it cited “current challenges to our business and the industry.” However, the timing strongly suggests a connection. This situation mirrors that of Romero Games, which also confirmed layoffs after its Xbox-funded project was canceled, though they were contractually unable to name the publisher.
The studio’s statement elaborated: “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 review has led us to the difficult conclusion that we must make changes to our staffing and locations. As a result, we are proposing to close our Liverpool studio, and to initiate a collective consultation process, as required by UK law. This will impact all Avalanchers in Liverpool. The changes will also impact our other studio locations in Malmö and Stockholm, where we will reduce our workforce and restructure the teams to address our games’ needs.”
Further reports indicate that a substantial portion of Avalanche’s current workforce will be affected, with sources directly linking these layoffs to Xbox’s decision regarding Contraband.
This isn’t the first time Avalanche has faced such changes; just over a year ago, the company closed its New York and Montreal studios, leading to approximately 50 job losses. With no new major projects publicly announced and no new entry in the Just Cause series since 2018, the future direction for Avalanche Studios remains uncertain.
The studio concluded its statement by saying, “Our immediate focus is to offer full support to all Avalanchers during this challenging time. Despite these changes, we remain deeply committed to providing amazing games to our passionate player communities.”