Warner Bros merger brings first job cuts at Skydance Games

Skydance Games has cut jobs barely a month after its parent company closed its $110 billion takeover of Warner Bros. Discovery. The gaming division is among the first parts of the newly merged entertainment giant to be trimmed, with developers across art, design, engineering and writing affected over the last few days. A Skydance spokesperson said the company had stepped back to rethink where it invests its efforts and decided to scale down some of its projects. "As a result, there are roles impacted," the spokesperson said, adding that the cuts did not reflect the talent or creativity of those leaving. The company hasn't shared how many jobs were lost or which projects are being pared back, though reports put the number at 30 or more.

Skydance Interactive and Paramount Games staff bear the brunt of the layoffs

The cuts appear to have landed on staff who came from Skydance Interactive, the studio behind The Walking Dead: Saints & Sinners, and Paramount Games. Warner Bros. Games employees do not seem to be part of this round. Rebecca Vessal, a senior gameplay and game AI programmer who kept her job, wrote on LinkedIn that "most of my game team at Skydance Interactive got laid off today." Engineer David Vera, also unaffected, posted that Skydance "just lost a ton of great talent yesterday" and stressed that nobody was let go over performance, before sharing a long list of former colleagues open to new roles. Skydance and Paramount merged their gaming businesses in the summer to form Paramount Games Studio, whose slate includes Teenage Mutant Ninja Turtles: The Last Ronin and Avatar Legends: The Fighting Game. Once the Warner deal closed on October 6, it was combined with Warner's in-house developers, including Avalanche Software, NetherRealm, Rocksteady and TT Games, under the Skydance Games banner. Tony Driscoll, who previously oversaw Fortnite's creator economy at Epic Games, heads the group as president of games and experiences.

Skydance has promised Wall Street at least $6 billion in merger savings

The layoffs coincide with co-CEOs David Ellison and Ynon Kreiz presenting their first quarterly results since the deal on Monday. The pair have committed to at least $6 billion in cost synergies and have said layoffs will be part of that. Late in October, the company also brought in a five-day office mandate and a voluntary buyout programme. Gaming has barely featured in the merger conversation. When leadership has brought it up, the focus has been on big names, with Ellison and Kreiz pointing to Hogwarts Legacy and Mortal Kombat in an October memo, and Driscoll highlighting Batman. The wider industry isn't offering much cushion either. Microsoft offered voluntary buyouts to a quarter of its workforce last month, Xbox staff included. For the developers Skydance has let go, that makes for a crowded job market to walk into.

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