“2024 Sees Unexpected Rise in Underperforming Game Studios: A Developer’s Insight”
A recent report from the Game Developer Collective indicates that numerous developers believe their studios did not meet performance expectations during the third quarter of FY 2024-2025.
Of those surveyed, 41% expressed that their employer performed “worse than anticipated.” The report highlights that this is a “significant increase” from the 20% who held this view in the first half of 2024-2025. In contrast, the proportion of developers who feel their teams exceeded expectations dropped from 24% to 16%.
While this year has witnessed numerous layoffs, not many publishers have attributed these job cuts specifically to poor sales. More commonly, layoff announcements refer to the “harsh realities” of the gaming industry or state that their game “did not meet our targets” with audiences.
On the other hand, Dont Nod made it clear in October that its struggles in the first half and underperforming titles this year indicated that layoffs were forthcoming.
41% of developers surveyed think their studio underperformed in Q3 of 2024-2025.
Looking ahead to the fourth quarter of 2024-2025, approximately 50% of surveyed developers believe their studio will end up breaking even compared to Q3. This outlook is slightly more optimistic than the sentiments expressed during the first half of the fiscal year.
Within this group, nearly 30% anticipate performing worse in this quarter. 20% expect to perform better, while around 5% remain uncertain.
Industry concerns across live service and overall market conditions
Developers have been open about their industry apprehensions in two previous Collective surveys this year. In April, 70% of participants were doubtful about the sustainability of live-service games. Since then, major entries in the genre such as xDefiant, Suicide Squad, and Harmony have either lost support or are on the verge of doing so, leading to team layoffs or complete shutdowns.
In June, 59% of developers surveyed felt the industry was in a precarious state, grappling with “poor market conditions.” Furthermore, 49% expect the situation to remain the same through 2025.
Regarding the roots of these challenges, 61% of developers blamed “unrealistic” expectations imposed by publishers. Following closely was 58% who pointed to mismanagement. Accusations of mismanagement have surrounded xDefiant and Dont Nod throughout the year, as well as the Greedfall II developer Spiders.
About the Author
Contributing Editor, GameDeveloper.com
Hailing from Kansas City, MO, Justin Carter has contributed to a variety of websites, including IGN, Polygon, and SyFy Wire. In addition to his work at Game Developer, his articles can also be found on io9 at Gizmodo. Don’t ask him how much gum he has chewed, as the answer will be more than he’s willing to admit.