Destiny 2 and Marathon plans got "overly ambitious," so Bungie is firing 220 people and spinning out a sci-fi action game to form a new studio within PlayStation

Bungie has laid off 220 developers, or 17% of its global workforce, while announcing a new studio has been founded to continue the development of one of its incubation projects under PlayStation.

Today, July 31, Bungie CEO Pete Parsons penned a blog post called 'The New Path for Bungie.' "Due to rising costs of development and industry shifts as well as enduring economic conditions, it has become clear that we need to make substantial changes to our cost structure and focus development efforts entirely on Destiny and Marathon," Parsons writes.

As a result, 220 developers at Bungie - or 17% of the studio's total global workforce - will be made redundant. "These actions will affect every level of the company, including most of our executive and senior leader roles," writes Parsons. Additionally, 155 roles at Bungie, or 12% of its global workforce, will be integrated into Sony Interactive Entertainment over the "next few quarters."

"We are working with PlayStation Studios leadership to spin out one of our incubation projects – an action game set in a brand-new science-fantasy universe – to form a new studio within PlayStation Studios to continue its promising development," Parsons continues. Bungie working on a third title was previously known, but this move takes it away from the studio.

Parsons also writes that Bungie wanted to ship three huge franchises - two of them being Destiny and Marathon - but rapid expansion "forced our studio support structures to scale to a larger level than we could realistically support." The Bungie CEO says this was exacerbated by 2023's "broad economic slowdown," and the "quality miss" with Destiny 2's Lightfall expansion.

"Bungie will continue to make great games. We still have over 850 team members building Destiny and Marathon, and we will continue to build amazing experiences that exceed our players’ expectations," Parsons concludes.