Rec Room
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Embracer layoffs, Nintendo's patent problem, and is Baby Steps an Uncharted sequel? - Patch Notes #46
Several game development studios have announced layoffs and closures, including Embracer Group's Eidos Montreal and Ivy Road. Shinji Mikami has founded a new studio, Unbound Inc., with Shift Up. The Super Mario Galaxy Movie is performing well at the box office, while Nintendo's patent for a sub-character combat mechanic has been rejected. Rec Room is shutting down due to profitability issues, and VR developer Polyarc has also made layoffs.
Roblox rival and Deus Ex dev the latest to be hit by video game layoffs
The video game industry is experiencing widespread layoffs, with major companies like Epic Games and Eidos-Montréal reducing their workforces. Even successful titles like Fortnite are not immune, as Epic Games let go of 1,000 employees. Several studios, including Rec Room and Ivy Road, are shutting down entirely due to financial difficulties and a challenging market, particularly in VR.
Rec Room shutting down after failing to become 'sustainability profitable'
The VR chat and game platform Rec Room will shut down on June 1, 2026, ten years after its launch. Despite its popularity and a strong community, the developer was unable to achieve sustainable profitability due to overwhelming costs. The company previously laid off staff in August 2025, citing financial trajectory concerns.
Rec Room will be shutting down on June 1st
Developer Rec Room announced it will shut down its social and gaming platform Rec Room on June 1st, the game's 10th anniversary. Despite reaching over 150 million players, the company cited unsustainable costs and a difficult path to profitability in the current market as reasons for the closure. All first-party content will be discounted by 80% as a thank you to players.