Fae Farm developer Phoenix Labs lays off staff and cancels projects in significant restructure

Fae Farm and Dauntless developer Phoenix Labs is undergoing a significant restructure, cancelling all other projects and laying off around 140 staff.

The studio shared the news in a LinkedIn post, stating that after a "long period of evaluating how to navigate our economic environment, we have had to significantly restructure the company to pave a path for a strong future."

The statement does not specify how many staff are affected by layoffs, but principal engineer Kris Morness posted "about 140" people have been impacted. What's more, one of the cancelled projects includes a game set to be announced in a month's time.

Is the closure of Hi-Fi Rush and Redfall's studios a sign Xbox Game Pass publishing is failing?

"We are reorganising Phoenix Labs to focus on our best-in-class live service titles, Dauntless and Fae Farm, and serving their communities," the studio's statement continues.

"This unfortunately means cancelling work on all other projects at the studio, which will impact many of our colleagues immediately. We are giving notices to everyone whose roles are affected.

"This restructure has not come easily, and truly has been the last resort to ensure Phoenix Labs can survive, and thrive in the long term. It's impossible to put into words how deeply we value every talented individual who has contributed their hard work and passion to every project at our studio."

The Vancouver and Montreal-based Phoenix Labs was founded in 2014 by former Riot developers. Dauntless, its first game, is an ARPG released in 2018, while farming life sim Fae Farm was released just last year.

The developer laid off 34 staff last December across its publishing, HR, IT and shared services teams. "Our games teams were unaffected and our work continues across our titles at Phoenix Labs," it said at the time.

The news follows recent layoffs at Square Enix across its US and European offices, as well as the closure of multiple Bethesda studios by Microsoft.

For more on layoffs across the industry, check out our article on what's going on with layoffs in the video game industry.