In a devastating blow to one of gaming’s most iconic studios, Bungie — the creator of the beloved Destiny franchise — is undergoing major layoffs that will cut a “significant number of employees,” including most of the Destiny team and some members working on Marathon.

PlayStation CEO Hermen Hulst confirmed the painful decision in a public statement, describing it as “difficult” but “necessary to align the studio’s resources with its current priorities and long-term goals.” The cuts follow the recent end of new content for Destiny 2 and disappointing player numbers for the new extraction shooter Marathon.

Hulst noted that “multiple alternatives” were explored before resorting to layoffs, but offered no specifics. He praised Destiny 2 as a “remarkable” series while acknowledging it is no longer receiving updates, and emphasized that Marathon remains “an important part of our portfolio,” with its team also shifting toward new incubation projects.

This restructuring comes just four years after Sony acquired Bungie for $3.6 billion in 2022, at a time when Destiny 2 was thriving and live-service games were seen as the future. Now, with Destiny 2 winding down and Marathon struggling to gain traction, the studio is being forced to shrink dramatically to survive. Reports also indicate that Bungie studio head Justin Truman is stepping down.

For longtime fans who poured thousands of hours into Destiny, this news feels like the end of an era. The franchise helped define the looter-shooter genre and built a passionate community, but recent challenges have clearly taken a toll. The layoffs raise serious questions about Bungie’s direction under PlayStation and whether the studio can recapture its magic with new projects.

As the dust settles, many in the gaming world will be watching closely to see what Bungie’s smaller, restructured team produces next — and whether Marathon can still become the hit Sony hoped for.