Bungie face a full Sony takeover and more layoffs if Destiny 2: The Final Shape flops, according to reports

Destiny 2 developer Bungie are staring down the barrel of a full Sony takeover if forthcoming expansion The Final Shape doesn’t meet sales expectations, according to several anonymous current and former employees. The same sources also claim that the studio are prepared to cut staff again to meet their financial obligations as a Sony subsidiary, having laid off a significant proportion of their workforce in November.

All this comes from a new IGN report, which paints the picture of a studio awash with anxiety and racked by growing divisions between rank-and-file developers and leaders.

In theory, Bungie are a fully independent subsidiary of Sony right now, but that’s not how things may operate in practice. The company’s board of directors is divided between Bungie representatives, including co-founder Jason Jones, Bungie CTO Luis Villegas and Bungie CEO Pete Parsons, and Sony representatives, including PlayStation Studios head Hermen Hulst and Sony senior VP Eric Lempel.

Parsons holds a tiebreaker vote on decisions, giving Bungie more control over their direction than Sony. But according to IGN’s sources, the split board structure is contingent on Bungie meeting certain financial goals. If Bungie fall too far short of those goals, Sony are permitted to dissolve the board and take full control. And with The Final Shape delayed till Bungie's next fiscal year, and Bungie’s 2025-bound Marathon reboot a hefty on-going expense, many employees feel that this is a real possibility – as are further job losses. "We know we need Final Shape to do well," one source told IGN. "And the feeling at the studio is that if it doesn’t we’re definitely looking at more layoffs." Reportedly, chief people officer Holly Barbacovi has described the layoffs as a “lever” the company would pull again.

According to IGN’s sources, it was the prospect of a Sony takeover that prompted November’s layoffs. On top of the departures, the company have apparently implemented a studio-wide hiring freeze, reduced travel budgets, eliminated holiday bonuses and paused or ended benefits such as annual employee compensation adjustments to meet market rates and employee donation matching. Bungie are also only offering the contractually obligated 80% minimum studio performances bonuses this year. All this has taken a toll on morale, with one source describing the atmosphere as "soul-crushing".

Sources also say that many of those laid off were popular figures within Bungie with ample experience who've spearheaded various community initiatives. Those who've left include Bungie general counsel Don McGowan and the co-heads of diversity, equity, and inclusion clubs Pride@Bungie, Women@Bungie and Accessibility@Bungie.

Others say that Bungie are moving towards outsourcing more of development, based on discussions they’d heard within teams before and after the layoffs. In particular, it’s claimed that Bungie are attempting to shift away from in-house QA testing, with over 10% of the internal QA department laid off or fired between early October and early November. IGN cite former and current QA testers as saying that the department has endured increasing workloads and responsibilities and is subject to growing hostility from team and company leadership: during one meeting, the QA testers were reportedly described as "non-developers".

According to the report, Bungie leadership are discouraging staff from even discussing the layoffs and are pushing back on suggestions from below. Several sources working in the same department recalled a Q&A following the departures in November, in which a department head was asked if company leaders had considered taking salary cuts to save a few jobs. They were told that Bungie was "not that type of company."

Sony acquired Bungie in January 2022 for $3.6 billion. Here's what Parsons said at the time: "we remain in charge of our destiny. We will continue to independently publish and creatively develop our games. We will continue to drive one, unified Bungie community. Our games will continue to be where our community is, wherever they choose to play. With Sony’s support, the most immediate change you will see is an acceleration in hiring talent across the entire studio to support our ambitious vision."

Best of luck to all affected.