Destiny 2’s The Final Shape Expansion Could Be Bungie’s Last Chance To Remain Independent, Report Suggests

Behind the scenes at Destiny 2 developer Bungie, morale is reportedly all-time low following mass layoffs at the company and other cost-cutting measures. In a new IGN report, sources at the studio claim that a “soul-crushing” atmosphere has set in and that the company is at risk of being fully absorbed by Sony.

While Bungie was acquired by Sony for $3.6 billion in 2022, on paper, the company has still been able to operate relatively independently. In the aftermath of the acquisition, its board of directors consists of PlayStation Studios head Herman Hulst, senior Sony VP Eric Lempel, Bungie CTO Luis Villegas, Bungie co-founder Jason Jones, and Bungie CEO Pete Parsons. Essentially, Parsons gets a tie-breaking vote on decisions, but the catch here is that Bungie is obligated by Sony to meet certain financial targets.

Should Bungie fail to meet these targets, Sony can legally dissolve the board and take full voting power of the company. It’s a scenario that was looking increasingly likely following the release of Lightfall earlier this year, as the poorly received expansion saw the studio miss its 2023 financial forecast by 45% and the player count for Destiny 2 reach record lows. According to IGN, Parsons made the decision to lay off 100 staff members across several departments in an effort to cut costs, while other morale-boosting initiatives at the company were trimmed down substantially.

Bungie has also instituted a hiring freeze, removed holiday bonuses, reduced travel budgets, and is also pausing or ending several employee benefits like annual compensation adjustments that would be in line with market rates. According to the report, when employees asked if Bungie leadership would also be taking salary cuts to prevent layoffs, a department head said that Bungie was “not that type of company.”

Morale has taken a big hit, with IGN reporting that Bungie’s senior management has appeared to show a “surprising amount of indifference or even outright flippancy or hostility” about the current situation. More layoffs are reportedly expected if The Final Shape fails to perform better than Lightfall, something that Bungie is looking to avoid by delaying the expansion from February to June.

The developer has balanced its independence between eras where it worked under Microsoft and had a publishing agreement with Activision Blizzard. After it parted ways with Activision Blizzard in 2019, Bungie quickly established itself as a leader in the live-service gaming market while maintaining a high level of employee morale. According to IGN’s sources, the current mood at Bungie is that the “people-oriented” era is over and that the trust between employees and management has eroded.

For now, Bungie is in a precarious position as employees find themselves caught in the middle of alleged poor leadership and Sony’s high expectations for the Destiny studio.