Former Bungie Worker Claims Studio Faced Insolvency Without Sony Acquisition – Report [IGN]

Bungie misrepresented its finances and had significantly overextended itself when Sony acquired the studio for $3.6 billion in 2022, former workers claimed in a new Game File report published in the wake of Wednesday’s layoffs.

It was apparently bad enough that at least one source described as a “well-connected former worker” went so far as to claim that Bungie faced dire consequences if the acquisition hadn’t happened, saying that the “alternate history is insolvency.”

Their comments paint the picture of a studio that was struggling despite the success of Destiny and Destiny 2 due to supporting too many projects and other problems. Following the Sony acquisition, Game File’s sources claim Bungie repeatedly missed its financial targets, leading to roughly 100 employees being laid off in November 2023.

A second round of layoffs followed on Wednesday, impacting another 220 people, or 17 percent of the studio’s workforce, with another 155 being integrated elsewhere in Sony Interactive Entertainment. Bungie is also spinning out one of its incubation projects to form a new studio under the PlayStation banner.

Within Bungie, the layoffs had been anticipated for some time. In December 2023, IGN reported that the feeling within the studio was that it faced more reductions if The Final Shape didn’t do well. But according to Game File’s source, even The Final Shape being a major blockbuster success couldn’t have stopped the layoffs. Indeed, with Destiny 2 on the wane some seven years after its original release, The Final Shape reportedly failed to outsell the previous expansion, Lightfall, despite being a critical success.

Former Bungie workers and other members of the games industry have been vocal in the wake of the layoffs, with many of them blaming the studio’s leadership led by CEO Pete Parsons. Their sentiments were echoed by those in Game File’s report, claiming that Bungie “sold things they were just not able to deliver.” Parsons, for his part, blamed the cuts on the rising costs of development and “enduring economic conditions,” confirming that the studio had been “running in the red” following delays to The Final Shape and Marathon.

Bungie is far from alone in being hit with layoffs, with other publishers including EA, Xbox, Riot, and others also introducing cutbacks in what has been a difficult year for the games industry. For now, it will continue to focus its efforts entirely on Destiny and the upcoming Marathon, which does not have a release date and is currently set for some time in 2025.

Kat Bailey is IGN’s News Director as well as co-host of Nintendo Voice Chat. Have a tip? Send her a DM at @the_katbot.