Meta has completely shut down three of its virtual reality game studios, laying off many developers in the process, as the company pivots to AI and wearable tech.
On January 13, multiple developers from Twisted Pixel and Sanzaru Games posted online that they had been laid off from the studios. A Meta spokesperson confirmed the layoffs and Bloomberg’s reporting, confirming that three studios had been closed: Sanzaru (Asgard’s Wrath 2), Twisted Pixel (Deadpool VR), and Armature (Resident Evil 4’s VR port). The company also provided this statement to Kotaku via email:
“We said last month that we were shifting some of our investment from Metaverse toward Wearables. This is part of that effort, and we plan to reinvest the savings to support the growth of wearables this year.”
Online, affected staff posted about the layoffs, providing the first public confirmation that the studios involved were being completely shut down.
“Welp. As many will hear soon, several Meta game studios were closed today, including Sanzaru. It was an amazing team of powerhouse talent, and I’m really glad to have gotten to know everyone there,” posted senior-level designer Ray West on LinkedIn on Tuesday.
“I’ve just been laid off. It appears the entire Twisted Pixel games studio has been shut down. Sanzaru Games, too,” posted another developer on Twitter.
“Unfortunately, I was part of the layoffs today at Meta, and will be seeking a new role,” said Twisted Pixel VR gameplay designer Kathryn Yu on Bluesky.
This follows reporting on Monday that Meta was looking to pivot away from VR and the metaverse to AI and augmented reality tech after that part of the company lost $4 billion. Meta is reportedly looking to cut 10 to 15 percent of Reality Labs, its VR sector, which includes 15,000 employees as well as numerous game studios like Sanzaru. These teams were developing exclusive Meta Quest games, like last year’s Deadpool VR, which was developed by Twisted Pixel.
Sanzaru was acquired by Meta in 2020 following the release of Asgard’s Wrath, a popular and critically acclaimed RPG, in 2019. It developed a sequel that launched as a free pack-in game with the launch of the Quest 3 in December 2023. Twisted Pixel previously worked on games like Splosion Man and Lococycle before being bought by Meta in 2021 to work on VR titles. Armature was a port studio that worked on games like Borderlands, Fortnite, and Bayonetta. The studio developed Batman: Arkham Origins Blackgate for the PS Vita, as well. It was purchased by Meta in October 2022. Its last shipped project was the excellent VR port of Resident Evil 4.
Update: 1/13/26, 2:20 p.m. ET: The article has been updated to include a comment from Meta confirming the shutdowns and layoffs. The headline was updated to reflect this confirmation as well.
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