Tomb Raider Studio Crystal Dynamics Faces Another Layoff Wave

• Crystal Dynamics laid off employees for the third time in a row.
• Parent company Embracer Group performs well despite restructuring moves and asset sales.
• Ongoing layoffs fuel doubts about the timeline of the next Tomb Raider game.

In a new reorganization effort, Crystal Dynamics laid off about thirty workers. In a LinkedIn post, the company called the move "difficult but necessary," since it reorganizes "for our next generation." 

In the post, the company also acknowledged the departing employees and promised to help them through the change. Crystal Dynamics also emphasized that the modifications were intended to "optimize the continued development" of its upcoming Tomb Raider game while reorganizing the company as a whole to create "new games for the future."

Crystal Dynamics layoffs have affected its employees for the third time in 2025, which signals that there might be some kind of mounting pressure on the studio.

About 17 positions were cut by the studio earlier in March in order to "better align" with commercial objectives. Meanwhile, for the second time, an undisclosed number of employees were let go in August following the termination of Perfect Dark, a project that the studio was co-developing with Microsoft's The Initiative.

Crystal Dynamics: Key IPs, and Current Strain

Crystal Dynamics, a long-standing video game firm, is best known for the Tomb Raider franchise, along with other significant IPs, like Gex from 1995 and the dark-fantasy series Legacy of Kain. 

Amid the layoffs, Crystal Dynamics' artistic identity currently seems under strain as the studio is also dealing with shifting goals and an unpredictable production pipeline.

For the recent 30 layoffs, Crystal Dynamics has not specified which departments were impacted. However, it has now changed its focus to remaster its hit franchises, such as Tomb Raider I-VI Remastered and upgraded Legacy of Kain games.

The upcoming Tomb Raider game is currently its sole significant project that has been confirmed for the studio. Apart from that, on December 11, 2025, Netflix intends to release the second and last season of Tomb Raider: The Legend of Lara Croft.

Crystal Dynamics and Embracer Group

Crystal Dynamics had approximately 273 people when Embracer Group acquired it from Square Enix in 2022. The team's capacity, rate of development, and long-term creative output are now called into doubt after three rounds of layoffs have taken place within months.

The reorganization of Crystal Dynamics corresponds with extensive layoffs at parent organization Embracer Group, which has shed around 1,857 jobs in the last year due to a significant financial revamp. 

Embracer has also been rapidly selling its assets and merging studios. In spite of this, it is still among the best-performing groups in the Swedish gaming industry.

What Comes Next for Crystal Dynamics?

The current priority for Crystal Dynamics seems to be developing Tomb Raider above everything else. However, there are still doubts regarding the studio's ability to sustain momentum given the frequent layoffs and lack of significant releases. The reorganization might help Crystal Dynamics get ready for its "next generation," but it also highlights how uncertain the future is for developers and the games they intend to create.