Avalanche Studios, the developer best known for the Just Cause series, has shut down its Liverpool studio, resulting in the layoff of 31 employees. The company announced this update on its official website, confirming the conclusion of a “collective consultation process” that began in September.

Initially, Avalanche announced a restructuring plan aimed at ensuring the company’s long-term success, which included the decision to close the Liverpool location. The process was carried out in accordance with UK law. The company also indicated that these changes could affect its studios in Malmö and Stockholm, though no specific details about those locations were provided in the announcement.

In the statement released yesterday, Avalanche confirmed, “This process has now concluded, the studio has closed, and we have parted ways with 31 people.” The company praised the departing employees, saying, “The exceptional talent, passion, and commitment from everyone leaving have impacted every project.” Avalanche emphasized its commitment to supporting its staff through this transition and to continuing game development.

As of now, Avalanche has not mentioned the status of Contraband or any involvement with Microsoft in its restructuring plans.

The decision to restructure comes less than two months after the company announced it was pausing work on Contraband, an upcoming cooperative game developed in partnership with Xbox Game Studios Publishing. Contraband was first announced in 2021, but development was halted shortly after Microsoft announced layoffs in July 2025. These layoffs affected multiple studios and projects within Microsoft’s gaming division, as well as external developers working with Xbox Game Studios.

Previously, Avalanche closed its studios in New York and Montreal last year, laying off 50 employees. The company described those closures as difficult but necessary for a sustainable future. Additionally, in April 2024, Avalanche employees in Sweden formed a bargaining agreement with local unions, which began in the second quarter of 2025 and is set to last two years before negotiations resume.

CEO Stefánía Halldórsdóttir highlighted the company’s efforts to improve working conditions, stating, “Over the past years, we’ve taken significant steps toward making Avalanche one of the best workplaces in the games industry. We hope that signing a CBA will be yet another step in that same direction.”

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