Phoenix Labs cuts most of its staff in the latest round of layoffs

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Phoenix Labs announced that it is laying off most of its staff. This is the fourth round of layoffs since it was acquired by Forte Labs in 2023. The Canadian game studio said it would give updates about its projects within a few weeks.

Staff layoffs have become the norm in gaming as studios follow the industry trend in attempts to shed expenses and remain afloat. Phoenix Labs is the latest studio affected by staff layoffs as the Canadian game studio struggles to balance its books and keep working on its projects.

Phoenix Labs announces staff layoffs 

Phoenix Labs announced it would lay off most of its staff on Monday. In the LinkedIn post, the Canadian game studio revealed that the layoffs were part of “unfortunate but necessary” changes to its operations.

Phoenix Labs praised its staff for being talented, dedicated, and creative. It added that it recognized each individual’s contributions to the company and its game projects. The Canadian studio gained recognition after its first game titled Dauntless, a Monster-Hunter-like live service game, and Fae Farm, an indie RPG released in 2023, became commercial successes. 

The layoff announcement is the fourth round of staff cuts after Phoenix Labs was acquired by the blockchain company Forte Labs in an unannounced transaction in 2023. The first round of layoffs occurred in May 2023 and affected 9% of staff under the pretext of focusing on new releases. In December 2023, the Canadian game studio performed the second round of layoffs and laid off 34 staff members. The 34 staff members laid off were from the IT, HR, and shared services departments.

In 2024, the layoffs spiked as Phoenix Labs released 140 more staff members in May while its COO and CEO stepped down in September. Phoenix Labs also canceled multiple projects, with the focus being directed on sustaining Dauntless and Fae Farm. Among the canceled projects was a game week away from being released.

Phoenix Labs’ layoff reignites layoff debates among gamers

The latest round of layoffs announced on Monday is the most severe of the lot, with most staff expected to leave the budding game studio. The layoffs will affect most of the studio’s development team. 

Phoenix Labs also promised gamers that it would give updates on its current projects, Dauntless and Fae Farm, within the coming weeks. The announcement came as other key players, such as Ubisoft, are set to continue with their announced layoffs of over 185 staff members. Ubisoft will release its staff after closing down its Leamington studio. The announced layoffs sparked speculation in the gaming sphere following the record-high layoffs recorded in the industry in 2024.

Gamers online debated layoffs in the gaming industry after Phoenix Labs made its announcement. Some said that the layoffs at Phoenix were to be expected after the studio gave the worst possible update in 2024. Others said that the introduction of monetization and other predatory decisions, such as eliminating devs and retaining management for games such as Dauntless, were to blame for the layoffs. 

Some gamers also questioned the layoff trends and the reality on the ground, given the record layoffs in 2024. They questioned whether the headlines matched the actual employment situation in the gaming field. The gamers argued that since they were unable to compare layoff figures against the number of jobs created, they couldn’t tell if the trend was really alarming to begin with.

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