Liquid Sword announces "deeply regrettable" layoffs, citing the need for "the studio's long-term sustainability"

Liquid Swords, a game development firm supported by NetEase, has announced layoffs, describing these steps as "deeply regrettable," yet vital for ensuring "the studio's long-term sustainability."

The studio, established by Christofer Sundberg, a co-founder of Avalanche Studios, disclosed today its decision to downsize, explaining it as a strategic move to "scale back operations and align with current industry conditions."

The Swedish company stated it "acknowledges the challenging circumstances faced by its valued team" and is committed to offering "as much support as possible" without specifying what form this assistance will take.

The exact number of affected employees was not disclosed.

Sundberg expressed, "I assured our employees and shareholders of success, aiming to create a studio that redefines game development with a compact, skilled team and a sustainable model. Despite achieving many of these goals, changing market conditions hindered us from meeting our timeline."

He added, "We must part with talented team members who have significantly contributed to our progress. This is a tough decision, but our commitment to our vision remains steadfast as we continue developing our IP and first game with a dedicated team."

Liquid Swords asserts its dedication to Sundberg's aim of "streamlining the game development process."

In the initial weeks of 2025, more than 900 developers have been laid off, with job losses and studio closures at Freejam, Splash Damage, Piranha Games, Jar of Sparks, and 185 positions eliminated by Ubisoft. Additionally, ProbablyMonsters announced further layoffs, along with job reductions at Iron Galaxy and Sumo Group.