Bungie Layoffs: Destiny 2 & Marathon Teams Cut in Major Reshuffle

Bungie has initiated a sweeping wave of layoffs, gutting the vast majority of the team behind Destiny 2 alongside staff working on its extraction shooter, Marathon. The studio announced, and Washington State labor filings confirmed that at least 292 employees at the Bellevue studio have received separation notices, taking effect July 9. The reduction marks a dark milestone for the legendary creators of Halo, just years after Sony bought the company for $3.6 billion to champion its live-service ambitions. 

This restructuring reaches far beyond routine cost-cutting, dismantling core creative pillars and triggering a sudden reset at the very top. According to Bloomberg, longtime studio head Justin Truman is also stepping down amid the overhaul. The purge is cutting indiscriminately through specialized disciplines, with former cinematics director John Ebenger confirming on social media that Bungie’s cinematic department was wiped out overnight. The fallout has also spilled into parent company Sony Interactive Entertainment (SIE), eliminating several dedicated corporate support teams that helped keep Bungie’s day-to-day studio operations running.

Executives attributed the painful downsizing to prolonged financial underperformance, admitting candidly on social media that Destiny 2 had missed its revenue targets for several running years. With the game releasing its final major live-service content update earlier this month, and Bungie's next wave of unannounced projects still stuck in "early incubation," leadership concluded the studio simply could not sustain its previous size. 

Addressing the public, Bungie framed the move as a necessary reorganization. “We know this decision has a profound impact on the people affected, their families, friends, and teammates,” the studio wrote on social media. “While these changes are necessary to best position the studio now and for the future, that does not lessen the difficulty of this moment.”

CEO Hermen Outlines 'Painful' Workforce Alignment in Memo

PlayStation Studio Business Group CEO Hermen Hulst echoed that grim reality in a somber internal memo sent to staff. Calling the cuts "painful news," Hulst explained that leadership spent months reviewing Bungie’s priorities and explored multiple alternatives before pulling the trigger, as per Kotaku. 

While Hulst took a moment to praise Destiny’s newly concluded ten-year run as an industry-defining, “truly remarkable” achievement, he stressed that the workforce had to be aligned with long-term goals. The restructuring reflects broader industry pressures, where live service games demand heavy investment but face intense competition. 

With Destiny 2 officially closing out its active live pipeline, Bungie’s immediate survival now rests almost entirely on Marathon. The sci-fi shooter has already endured a rocky road, suffering post-launch growing pains right as parent company Sony absorbed a staggering $765 million USD impairment loss across the fiscal year tied to Bungie's wider portfolio underperformance.

Even so, Hulst insisted to employees that the game remains a vital pillar of PlayStation's portfolio. Encouraging the remaining staff to build on the foundation of the game's first two seasons, Sony pledged that Marathon will continue to receive planned content updates through at least the end of 2026.

For the developers thrust into an already unforgiving industry job market, this week caps off a multi-year bleed of world-class talent. During the pandemic boom, Bungie’s headcount swelled to roughly 1,300 workers; following 100 cuts in late 2023 and another 220 in mid-2024, the studio sat at around 800 employees. 

While Sony has promised standard transition support, severance packages, and an effort to redeploy laid-off staff across its global network of studios, the human cost leaves the wider gaming community watching in quiet dismay as the pioneering architects of the modern looter-shooter are left fighting for their own existence.