Just Cause developer Avalanche Studios has announced plans to lay off staff across its studios in Malmo and Stockholm, and close its office in Liverpool, impacting all of the company's UK staff.
The announcement comes just a month after Xbox formally canceled Contraband, Avalanche's long-gestating open world co-op game that had been in development since at least 2021. That decision followed mass layoffs at Microsoft in July that eliminated 9,100 jobs and resulted in Xbox's own Everwild and Perfect Dark being ditched.
In a statement published today on Avalanche's website, the company did not specifically blame Contraband's cancelation as the reason for the layoffs, instead referring to "current challenges to our business and the industry."
However, the timing of the move leaves little to the imagination, and the language here is similar to that used by Romero Games, which also confirmed layoffs after the cancelation of its own Xbox-funded project, though said it was contractually unable to name the publisher it had been working with.
"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," the company wrote today.
"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 Malmo and Stockholm, where we will reduce our workforce and restructure the teams to address our games' needs."
Alongside the proposed closure of Avalanche's Liverpool office, a report today by DBLTAP states that "a signficant percentage" of the company's current workforce will be impacted, with sources confirming the layoffs were a direct result of Xbox's decision to cancel Contraband.
The announcement comes just over a year after Avalanche previously shut its New York and Montreal studios, resulting in the loss of around 50 jobs. With no new project publicly announced, and no entry in the company's trademark Just Cause series launched since 2018, it's unclear where Avalanche's future now lies.
"Our immediate focus is to offer full support to all Avalanchers during this challenging time," the studio concluded today. "Despite these changes, we remain deeply committed to providing amazing games to our passionate player communities."
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