Microsoft Shuts Down Hi-Fi Rush Dev Studio, 3 More Game Makers

Microsoft is shutting down the studio behind Hi-Fi Rush and three more under its Bethesda wing in a move to prioritize "high-impact titles."

In an email to staff via IGN, Xbox Game Studios president Matt Booty announced the closure of the Hi-Fi ­Rush studio Tango Gameworks, Redfall developer Arkane Austin, and mobile game Mighty Doom maker Alpha Dog Games.

Meanwhile, Roundhouse Studios will be absorbed by ZeniMax Online Studios, developer for The Elder Scrolls Online.

The decision is expected to cause mass layoffs across the affected game studios, although Microsoft and Xbox did not provide an exact number.

Shuttered Bethesda Studios to Sunset Development, Live Service of Games

Arkane Austin has already confirmed the reports on X (formerly Twitter), stating that its sister studio in France will continue development for all of its future projects.

Mighty Doom will also close its live services by Aug. 7, "turning off the ability for players to make any purchases in the game."

Hi-Fi Rush was the winner of the 2024 BAFTA Animation Award and the 2023 The Game Award for Best Audio Design.

Despite critical acclaim, insider reports hinted that Xbox was not particularly happy with its sales numbers, while Redfall's bug-filled release only further hurt its already poor sales.

Microsoft Acquisition of Bethesda Blamed for Studios' Closure

Amid shutdowns, many players and developers were noticeably upset with Microsoft and Xbox for the cost-cutting move.

Even Arkane Lyon head Dinga Bakaba took the chance to criticize the "absolutely terrible" decision, reminding executives not to "throw us into gold fever gambits."

Microsoft acquired Bethesda, along with the studios under its wing, for $7.5 billion to boost its Xbox catalog.

The acquisition was followed by several corporate reorganizations that resulted in many longtime leaders of the studios leaving in the process.

Among those was Tango Gameworks founder Shinji Mikami who previously led the studio to make its other well-known titles like The Evil Within and Ghostwire: Tokyo.

Mikami has since started another studio, Kamuy, to have more creative control over his projects and move away from horror titles.