Bungie Lays Off 292 Bellevue Employees as Destiny 2 Era Ends

Bungie, the Bellevue-based studio behind Destiny 2, has laid off 292 employees following the release of the game's final live-service content update, which the company said "fell short of expectations." The cuts mark the studio's third round of layoffs in three years and signal a major turning point as Bungie pivots away from its flagship franchise.

The Scale of the Layoffs

Bungie laid off 292 employees on Thursday following its final update to one of its staple video game franchises, which the company said "fell short of expectations." The layoffs impacted most of the employees working on the "Destiny" series and a small number of members working on the "Marathon" video game, according to Sony executive Hermen Hulst. A WARN notice filed with the Washington State Department of Employment said the reduction in force affects approximately 292 employees at Bungie's Bellevue facility, with employees notified Thursday and expected to separate from the company on July 9.

The financial terms of the separation are also outlined in the state filing. The filing states the layoffs are permanent, affected employees will receive a combination of notice and pay instead of notice totaling 60 days, and none of the affected workers are represented by a union. A vast majority of the positions impacted include video game engineers, producers, and designers.

How Far Bungie Has Fallen From Its Peak

This round of cuts represents a dramatic reduction from the studio's headcount at its height. Recent estimates put the studio's total headcount at around 800, down from a peak of around 1,300 just a few years ago. That would suggest Bungie is now down to around 500 or fewer staff, just over a third of what it was back when Sony purchased it for $3.6 billion. The latest layoff announcement marks the company's third round of layoffs in the last three years, underscoring a sustained period of contraction since the Sony acquisition.

What Sony's Leadership Said

Sony Interactive Entertainment framed the decision as the outcome of a lengthy internal review rather than a snap reaction. Hulst said the decision followed months of discussions between Sony Interactive Entertainment and Bungie leadership reviewing the studio's long-term direction, development priorities, resource needs, and role within Sony's broader portfolio strategy. "We explored multiple alternatives before concluding that a reduction was necessary to align the studio's resources with its current priorities and long-term goals," he wrote.

Hulst acknowledged the human toll of the decision directly in his message to staff. The executive described the move as "painful news," particularly for employees whose positions were eliminated, and closed his message by thanking affected employees for their "hard work, creativity, and contributions to Bungie, SIE, and the broader gaming community," encouraging remaining employees to support one another as they process the news. Bungie itself wrote in a statement, "We know this decision has a profound impact on the people affected, their families, friends and teammates. While these changes are necessary to best position the studio now and for the future, that does not lessen the difficulty of this moment or the impact it has on those affected".

A Leadership Shakeup, Too

The layoffs coincided with a significant change at the top of the studio. According to Bloomberg's Jason Schreier, Bungie studio head Justin Truman has also stepped down. He joined back in 2010 as an engineering lead on the original Destiny before eventually being promoted to general manager for Destiny 2, and took over the top job at Bungie last year when then-CEO Pete Parsons departed after 23 years at the company.

Why Now: The End of Destiny 2's Live-Service Run

The timing of the cuts is directly tied to the conclusion of nearly a decade of ongoing support for Bungie's flagship title. The company said workforce reductions were necessary as it moves beyond nearly nine years of supporting its live-service game "Destiny 2" and continues work on projects in early development. The latest mass layoffs come after Destiny 2 was officially sunset, with its final update earlier this month, even as Hulst praised the franchise's decade-long run, saying it had "left a lasting mark on players and the industry" and thanked employees who contributed to its success.

Despite the dramatic cuts to the Destiny team, Sony emphasized that Bungie's newer title remains a priority. Hulst said Marathon remains an important part of Sony Interactive Entertainment's portfolio and that the company will continue to support its development.

The Human Impact

The layoffs have reverberated widely across the studio's various departments. The layoffs hit developers across all different departments and disciplines. "The entire Cinematic org was included," now-former Bungie cinematics director John Ebenger wrote on Bluesky. "Let me know if you're looking to pick up a Director and/or other talented cine folks at any level". Other messages from impacted employees poured out across social media and LinkedIn as they were thrust into one of the most challenging job markets the gaming industry has ever seen.

For continued, up-to-date tracking of layoffs and restructuring across the video game industry, the GamesIndustry.biz news desk remains a leading, authoritative resource for following these developments.

What Comes Next for Bungie

With Destiny 2's live-service era now formally over and a new studio head yet to be named, Bungie's path forward will likely hinge heavily on the success of Marathon and whatever new projects emerge from its early-development pipeline. Given the studio's repeated rounds of layoffs since the Sony acquisition, the broader gaming industry will be watching closely to see whether this restructuring finally stabilizes Bungie's headcount — or whether further cuts lie ahead as the studio searches for its next big hit.