Amazon’s gaming ambitions finally died this week. As the company announced sweeping layoffs affecting up to 30,000 corporate employees on October 28, 2025, the games division got the axe. Steve Boom, vice president of Audio, Twitch, and Games, sent the memo that confirmed what everyone already suspected – Amazon’s decade-long push to crack gaming has failed spectacularly, and the company is abandoning most of its big budget dreams.
The End of Amazon’s MMO Dreams
“While we’re proud of our successes in first-party AAA game development and publishing, we have made the difficult decision to halt a significant amount of our first-party AAA game development work – specifically around MMOs – within Amazon Game Studios,” Boom wrote. Translation: we’re giving up. The company that once dreamed of building the next World of Warcraft is now admitting that dream is dead.
New World, Amazon’s flagship MMO that launched with over 900,000 concurrent players on Steam, is getting abandoned. The Lord of the Rings MMO that Embracer Group was supposedly developing with Amazon is basically done for. These weren’t just any games – they represented Amazon’s entire strategy for dominating gaming, years of development work and hundreds of millions in investment, all for nothing.
The layoffs will hit hardest at Amazon’s offices in Irvine and San Diego where most of the game development actually happened. The central publishing team is also getting gutted. How many jobs are being cut? Amazon won’t say exactly, just that it’s “significant role reductions.” But employees on LinkedIn and X are revealing the truth – entire teams from New World and the Lord of the Rings project are gone.
What Amazon Games Is Abandoning
- New World MMO – no more content updates after this
- Lord of the Rings MMO – development halted entirely
- Significant AAA first-party development across the board
- Most of the San Diego and Irvine studio staff
- Central publishing division gutted
- Blue Protocol western release already canceled earlier
- Essentially the entire MMO strategy from the last decade
A Decade of Gaming Failures
This isn’t Amazon suddenly changing direction – it’s the inevitable conclusion to a strategy that never worked. The company entered gaming with Crucible in 2020, a free-to-play shooter that was “unreleased” back into beta just five months after launch. Five months. Imagine sinking resources into a game so broken you have to take it down.
Amazon tried an earlier Lord of the Rings MMO that got canceled in 2021 after disputes with Chinese mega-corporation Tencent. Then came New World in 2021, which actually launched successfully with impressive player numbers. For a moment, people thought Amazon finally had their hit. Then the players left because the game couldn’t retain them. After a strong start, engagement collapsed. By the time of this announcement, New World’s concurrent player count had become a fraction of its glory days.
The company threw money at the problem repeatedly. They couldn’t buy their way to success. Lost Ark, a Korean game they published in western markets, had some success but proved that publishing existing games is radically different from building originals. Everything Amazon developed from scratch either failed immediately or failed slowly after initial hype.
What Survives (Barely)
Amazon isn’t completely exiting gaming, they just want you to know they’re “leaning into the things Amazon does best.” Translation: they’re focusing on Luna, their cloud gaming service that nobody uses. The Montreal studio will keep working on March of Giants, a strategy game apparently. There’s still ongoing work with Crystal Dynamics on a new Tomb Raider game. Maverick Games continues on an open-world racing title. But these feel like obligations Amazon is finishing rather than commitments they believe in.
What matters is the direction: casual and AI-focused games for Luna. Party games. Courtroom Chaos featuring an AI version of rapper Snoop Dogg. King of Meat, which peaked at 253 concurrent players on Steam. This is what Amazon thinks is their future in gaming – casual experiences and AI gimmicks, not the AAA experiences they’ve been chasing for ten years.
The Luna Strategy Pivot
- Cloud gaming service relaunched with updates
- Focus on casual and AI-centric game experiences
- Luna games tailored for streaming entertainment value
- Emphasis on “value for Prime members”
- No more big-budget MMO ambitions
- External studio partnerships like Crystal Dynamics
Why Did Amazon Lose at Gaming
It comes down to three things: Amazon is fundamentally a business and logistics company trying to play in entertainment, talent acquisition, and the fact that MMOs are brutally difficult to succeed at. Even the legendary BioWare is struggling with Anthem, the industry isn’t forgiving anymore.
Successful game studios build culture over decades. Bungie spent years as Microsoft’s crown jewel before launching Halo. Blizzard spent years building World of Warcraft before it became the cultural phenomenon that dominated 2000s gaming. Amazon thought it could hire experienced executives, write checks, and build an instant gaming powerhouse. That’s not how this works.
Second, running MMOs means maintaining live services indefinitely. New World launched in 2021 and Amazon still has to support it, keep players engaged, produce content, deal with exploits, manage economies. That’s not a one-time product launch, that’s a permanent operational commitment. Amazon apparently discovered they weren’t good at maintaining that. The game wasn’t dying from bugs or poor design necessarily – it was dying because Amazon’s operations couldn’t keep players interested long-term.
Third, the market is matured. World of Warcraft still dominates despite being over 20 years old. The audience for premium MMOs isn’t growing, it’s shrinking as those players age and game time commitments become unrealistic. Amazon entered MMOs thinking they could throw money at nostalgia and competition. Meanwhile the entire industry shifted to free-to-play models, battle royales, and seasonal content treadmills.
The Personal Impact
What’s brutal about this for gaming employees is the timing and method. One LinkedIn post from a senior gameplay engineer on New World: “This morning I was part of the layoffs at Amazon Games, alongside my incredibly talented peers on New World and our fledgling Lord of the Rings game (y’all would have loved it).” Years of work on a game people would have loved, just terminated by email.
Another story circulating: an Amazon employee received their layoff email while flying back to Bengaluru after Diwali break. He landed at the airport, turned on his phone, and there it was. The termination message. Two months severance, apparently, but that doesn’t cushion the blow of getting fired when you were genuinely excited to return to work.
A third employee noted she’d received a promotion and positive performance review just last month. Today, laid off. “Even performance doesn’t matter to these guys when it comes to layoffs,” she wrote. These aren’t failures or poor performers getting let go – these are talented people whose work got eliminated because the company’s leadership couldn’t execute their vision.
The Broader Tech Layoff Context
Amazon’s 14,000 layoffs (potentially 30,000 total) aren’t unique. Microsoft cut about 10,000 jobs this year. Google cut 10,000. Meta, Salesforce, Oracle – the entire tech industry has been on a firing spree. The excuse is usually AI and efficiency, but the reality is bloated corporate structures built during the pandemic-era hiring spree where everyone hired frantically.
Gaming is getting hit particularly hard because it’s less core to any of these companies’ missions. Azure matters to Microsoft. Advertising matters to Google. Amazon’s gaming division was always a side project, something the company thought could become important but ultimately decided wasn’t worth the resources. When push came to shove, games were expendable.
This is the normal business cycle for tech companies entering entertainment – they try, they fail, they retreat. Remember when Samsung made smartphones? When Microsoft made music players? When Google made Google Glass? Companies that are phenomenal in one domain don’t automatically succeed in adjacent fields. Amazon learned that lesson the hard way after ten years and likely billions in investment.
FAQs
How many Amazon games jobs are being cut?
Amazon hasn’t disclosed exact numbers for the games division, only that layoffs are “significant” with major cuts in Irvine, San Diego, and the central publishing team. Part of 14,000 total corporate layoffs announced October 28.
What happened to New World?
New World launches with over 900,000 concurrent players in 2021 but couldn’t retain engagement. The game is now being abandoned with no new content updates after this announcement.
Is the Lord of the Rings MMO canceled?
Effectively yes. While not explicitly stated as canceled, development has been halted as part of Amazon’s decision to stop significant AAA MMO work. The game that was supposedly being developed with Embracer Group is basically done for.
Why is Amazon leaving gaming?
Amazon never had a winning strategy in gaming. After a decade of failed and underperforming titles, the company decided the investment wasn’t worth it. They’re refocusing on Luna cloud gaming and casual AI experiences instead of competing with established publishers.
Will Amazon still publish games?
Amazon will continue some partnerships like Crystal Dynamics’ Tomb Raider game and Maverick Games’ racing title. But the company is pivoting to casual and AI-focused games for Luna rather than competing in premium AAA development.
How many total Amazon layoffs are happening?
Amazon announced 14,000 corporate employees being laid off, though some reports suggest total cuts could reach 30,000. This is the largest layoff wave in company history.
Was this announced suddenly?
For the public, yes. Employees found out via email on October 28, 2025, with some receiving notifications while traveling or on vacation. It was shock termination rather than gradual wind-down.
Conclusion
Amazon’s games division dies not with a bang but with a memo announcing pivot to casual and AI experiences. A decade of ambition to compete with Blizzard, Riot, and other gaming powers crumbles in the face of financial pressure and the company’s realization that entertainment isn’t their core strength. New World’s failed retention, the Lord of the Rings MMO’s uncertain future, Crucible’s embarrassing quick death – the scorecard was clear. Amazon tried gaming, gaming beat Amazon, and now it’s moving on.
What’s tragic is the human cost. Talented developers who believed in their projects and their employer got terminated by email while on vacation or flying home from break. Years of work on games people would have loved just evaporates because corporate leadership decided the business model doesn’t work. For everyone affected, it’s a harsh reminder that even the world’s richest company can fail at executing entertainment visions, and when the executives decide to quit, it’s the developers who pay the price.
Amazon will keep running Luna, keep working on the Crystal Dynamics Tomb Raider game, maybe release some AI-powered party games for Prime members. But the grand ambition to build the next World of Warcraft, to own a space in gaming culture comparable to its dominance in e-commerce and cloud computing – that dream is officially dead. Sometimes the best business decision is admitting you can’t win and redirecting resources elsewhere. For everyone working at Amazon Games, that decision arrived just a little too late.