Iron Galaxy has announced another round of layoffs, aiming to scale the company to what it perceives as a definitive “new normal.” This follows a previous round just over a year ago that resulted in 66 job losses. While the exact number of employees affected this time is unknown, a source cited by Kotaku suggests approximately 90 individuals were let go.
The “new normal” that the studio refers to is the long-sought return to pre-2020 industry conditions. “Since 2020, as everything related to creating video games started to change, people have been waiting for the business to ‘return to normal,'” the statement reads. “This is what conversations with colleagues and partners at game developer gatherings have been about. This year, we are taking a new stance and accepting that the current market conditions are permanent.”
Iron Galaxy explains that the changes experienced by the video game industry in recent years affect all stakeholders, essentially anyone who invests financially in creating or purchasing games. “Players consume games in new ways. Publishers have different criteria for investing in game development. This new normal has impacted all of our partners,” they state.
This necessitates “painful decisions” to adapt the company to these new paradigms. Iron Galaxy acknowledges that “it is impossible for us to maintain the size we have had over the last year, even after last year’s adjustments.” This led to the new cuts, which may have halved, or more, the studio’s size. Just three to four years ago, the company had around 250 employees following an investment round that aimed, among other things, to create a hundred new jobs.
This notion of a new normal that requires adaptation, rather than merely enduring a temporary storm, is becoming increasingly prevalent in the video game industry. The industry experienced a significant boom in 2020, which in retrospect, appears to have been artificial and perhaps irresponsible. Iron Galaxy’s message is noteworthy for its directness, while other companies still seem to cling to hopes of a return to normalcy that appears increasingly improbable.
Iron Galaxy has been active since 2008, primarily working as a support studio. Their early work included ports, which established them as a specialist in their niche. They later gained broader recognition for their work on Xbox One’s Killer Instinct, leading development from the second season after Amazon acquired Double Helix, the original studio, in 2014. Iron Galaxy’s most recent major project was Tony Hawk’s Pro Skater 3+4, the second set of remakes of Activision’s classics.
To illustrate the dramatic shifts in the video game industry over the past decade, the Amazon studio in Orange County that launched New World in 2021 was seen as a symbol of a new era. This era was marked by the entry of major players like Google (with Stadia), Apple (with Apple Arcade), and Amazon. As of 2026, Stadia is gone, Apple Arcade has lost its appeal, and New World, which is set to shut down its servers in a few months, is no longer being played. Meanwhile, Amazon is reassessing its role in the gaming sector without a clear direction.
