The situation keeps getting worse for the team behind Contraband and Just Cause: Avalanche Studios has announced another wave of layoffs and the permanent closure of its Liverpool office, painting a bleak picture for the studio’s future.

Avalanche Studios Group is ending September with more troubling news. The studio, best known for the Just Cause franchise and once in charge of developing the Xbox-exclusive Contraband, has confirmed the permanent closure of its Liverpool office. The announcement comes alongside a new round of layoffs that will also affect staff in Malmö and Stockholm, deepening concerns about the company’s future.

The news was delivered in an official statement on Avalanche’s website, briefly outlining the reasons for the restructuring and the company’s next steps. “Given the current challenges facing both our company and the industry, we have carefully evaluated how to best ensure the long-term success of Avalanche Studios Group,” the message reads. “This review has led us to the difficult conclusion that we must make changes to our workforce and studio locations.”

The statement clarified that layoffs would not only impact Liverpool but also significantly reduce teams in Malmö and Stockholm “to meet the needs of our projects.” For now, the company says it is focused on “providing full support to all Avalanchers during this difficult time” and reaffirmed its commitment to “delivering amazing games to our dedicated player communities.”

Layoffs Mount and Contraband Shuts Down

The internal situation at Avalanche Studios Group appears to be deteriorating rapidly. In June 2024, the company shocked the industry by closing its New York and Montreal studios — the latter of which had only recently been acquired. And in August, Xbox confirmed that development of Contraband had been completely halted, with sources close to the project suggesting that the cancellation is final.

All signs point to Avalanche entering one of the most difficult chapters in its history. What comes next remains uncertain, but there’s little doubt that the company and its workforce face a deeply challenging road ahead.

Source: 3djuegos