One of the UK’s most respected game studios is facing an uncertain future. Splash Damage announced on November 26, 2025, that it’s entering a studio-wide consultation process affecting every single employee across all roles and disciplines. This comes just two months after the London-based developer was acquired by unnamed private equity investors, following a pattern that’s become all too familiar in the gaming industry. For fans of classic multiplayer shooters like Wolfenstein: Enemy Territory and Brink, this news hits particularly hard.
What Studio-Wide Consultation Actually Means
In the UK, companies are legally required to consult with employees before making redundancies. A studio-wide consultation process means Splash Damage is considering layoffs that could affect everyone, from developers and artists to management and support staff. While it doesn’t guarantee the entire studio will shut down, it signals that significant job cuts are coming and potentially the closure of the studio entirely.
The company’s LinkedIn statement attempted to soften the blow. “This was a difficult step for us to take, but we believe it is necessary so Splash Damage can remain agile and adaptable in what has been a very challenging market,” they wrote. “We know that this kind of change is emotionally tough, and we will do what we can to guide our people through this process with honesty and care. We’re committed to exploring every option to retain talent and making sure those affected have meaningful support throughout.”
However, industry veterans see through the corporate speak. As one Reddit user translated it, “Our management made significant mistakes, forcing us to seek external assistance. Unfortunately, the dedicated employees who followed our directions will now face the consequences, while we remain here to keep making errors. To add to this, we’re hiring a consulting firm to take the blame, so we can avoid facing you directly.”
A Studio With an Incredible Legacy
Splash Damage was founded in 2001 and quickly made a name for itself in the competitive multiplayer shooter space. The studio’s breakthrough came in 2002 when they partnered with id Software to create Operation Market Garden, a multiplayer map for Return to Castle Wolfenstein that became the most played third-party map for the game. This success led to an even bigger opportunity.
In 2003, Splash Damage released Wolfenstein: Enemy Territory, originally planned as a paid expansion but released as a free standalone game after the single-player campaign was dropped. The class-based multiplayer shooter became a massive hit in the PC gaming community, praised for its teamwork-focused gameplay and objective-based missions. It remains beloved by fans over 20 years later and influenced countless multiplayer games that followed.
The studio followed up with Enemy Territory: Quake Wars in 2007, bringing their multiplayer expertise to the Quake universe. In 2011, they released Brink in partnership with Bethesda Softworks, their first multiplatform title that attempted to blend single-player, co-op, and multiplayer into one seamless experience. While Brink received mixed reviews, it showcased ambitious ideas about parkour movement and emergent gameplay that appeared in later shooters.
Beyond their original titles, Splash Damage contributed to major franchises as a support studio. They developed the multiplayer mode for Batman: Arkham Origins in 2013, called Invisible Predator Online. They also worked on the Halo and Gears of War franchises, including developing Gears Tactics, a turn-based strategy spinoff that received positive reviews in 2020.
Years of Instability and Failed Projects
Despite their pedigree, Splash Damage hasn’t released a successful game in years. The last title they shipped was Outcasters in 2020, a party shooter exclusive to Google’s Stadia streaming platform. When Google killed Stadia in 2023, Outcasters died with it, leaving the studio without a live product generating revenue.
In December 2022, Splash Damage announced Transformers: Reactivate at The Game Awards, a 1-4 player co-op action game that seemed like a perfect fit for the studio’s multiplayer expertise. The game featured no public showings over the next two years, operating in complete silence until January 2025 when Splash Damage announced its cancellation. Former employees and industry insiders described the project as chaotic, plagued by issues with rights, multiple changes in ownership, and at least one complete restart.
The cancellation of Transformers: Reactivate led to the first round of layoffs earlier this year, with a number of roles across the studio deemed at risk of redundancy. At the time, Splash Damage said they would refocus efforts on other projects, specifically mentioning Project Astrid, an open-world survival game developed in partnership with popular streamers Sacriel and Shroud that was announced in 2023. Now even that project’s future looks uncertain.
The Private Equity Problem
Understanding Splash Damage’s current predicament requires looking at its ownership history. Founder Paul Wedgwood sold the studio to Chinese holding company Leyou in 2016. Tencent then acquired Leyou in 2020, bringing Splash Damage under the massive Chinese conglomerate’s umbrella. Under Tencent’s ownership, CEO Richard Jolly expressed optimism about the studio’s future and growth prospects.
However, in 2024, both Tencent and competitor NetEase scaled back their international expansion plans amid regulatory challenges in China and disappointing returns on Western investments. This led to layoffs and strategic shifts across Tencent’s Western operations, including reductions at Sumo Group and the divestment of the Secret Mode publishing label. Splash Damage became another casualty of this retreat.
In September 2025, Splash Damage was sold to undisclosed private equity investors. The gaming community immediately expressed concern, as private equity ownership typically focuses on short-term profit extraction rather than long-term studio health. Just two months later, those fears were confirmed. The current leadership team remained intact through the ownership changes, but employees on social media reported extreme incompetence and lack of concern from management.
Private equity’s involvement in gaming has become increasingly controversial. These firms often acquire struggling studios at low valuations, cut costs aggressively to show short-term profitability, then either flip the studio to another buyer or shut it down entirely if no buyer emerges. Employees bear the brunt of these financial maneuvers while executives often walk away with bonuses.
Another Blow to UK Gaming
Splash Damage’s troubles represent another setback for London’s gaming scene, which has faced significant challenges over the past two years. Square Enix restructured its European operations, affecting over 100 positions at the former Eidos studios. Sony shut down its London Studio in 2024 despite the team’s work on VR titles for PlayStation. More recently, Turn10, Playtonic, Ubisoft Leamington, and Rare all experienced layoffs affecting UK-based staff.
According to Ukie, the UK gaming industry trade body, around 1,000 people across the country lost their jobs in 2024 alone. That means more than one in 30 people working in video games in the UK was affected by layoffs. The trend continued into 2025, with Splash Damage now joining that list. Industry experts identify three primary causes: lingering effects from COVID-era over-hiring, delays in game publishing creating revenue gaps, and the cost of living crisis reducing consumer spending on games.
The UK government launched a Video Games Council in July 2025 to support the industry and address the crisis, but advisory bodies don’t create jobs or fund studios. What the sector needs is sustainable business models, responsible ownership, and a market environment where talented studios can thrive without being flipped between owners seeking quick returns.
FAQs
Is Splash Damage shutting down?
Splash Damage announced a studio-wide consultation process on November 26, 2025, affecting all employees. While not confirmed as a complete shutdown, consultation processes typically precede significant layoffs. The studio’s future remains uncertain with potential outcomes ranging from major staff reductions to complete closure.
What games did Splash Damage make?
Splash Damage is best known for Wolfenstein: Enemy Territory (2003), Enemy Territory: Quake Wars (2007), Brink (2011), Dirty Bomb (2015), and Gears Tactics (2020). They also developed multiplayer components for franchises like Halo, Gears of War, and Batman: Arkham Origins.
What happened to Transformers: Reactivate?
Transformers: Reactivate was announced in December 2022 but cancelled in January 2025 after over two years of development with no public showings. The cancellation led to the first round of layoffs at Splash Damage earlier this year. The project reportedly faced issues with rights, multiple ownership changes, and at least one complete restart.
Who owns Splash Damage now?
Splash Damage was acquired by unnamed private equity investors in September 2025. The studio was previously owned by Tencent (since 2020 through the Leyou acquisition), Leyou (2016-2020), and was independently owned by founder Paul Wedgwood before that.
When was the last game Splash Damage released?
The last game Splash Damage shipped was Outcasters in 2020, a party shooter exclusive to Google’s Stadia streaming platform. When Google shut down Stadia in 2023, Outcasters became unplayable, leaving the studio without any currently available titles generating revenue.
What is Project Astrid?
Project Astrid is an open-world survival game announced in 2023, developed by Splash Damage in partnership with streamers Sacriel and Shroud. The project’s future is now uncertain following the studio-wide consultation announcement, though it was mentioned as a focus after Transformers: Reactivate was cancelled.
How many people work at Splash Damage?
Exact current headcount hasn’t been publicly disclosed, but the studio experienced layoffs in January 2025 following the Transformers cancellation. The studio-wide consultation announced in November affects all remaining employees across all roles and disciplines at the Bromley location.
Why are so many UK game studios closing?
The UK gaming industry has lost over 1,000 jobs since 2024, representing more than one in 30 workers. Industry experts cite COVID-era over-hiring, game publishing delays creating revenue gaps, and the cost of living crisis reducing consumer spending as primary factors driving studio closures and layoffs.
What does consultation mean in UK employment law?
Under UK law, companies must consult with employees before making redundancies. A consultation process involves informing staff about potential job losses, explaining reasons, discussing alternatives, and giving employees time to respond. Studio-wide consultation suggests significant layoffs affecting most or all positions.
What This Means for Gaming
Splash Damage’s potential closure would mark the loss of another studio with deep roots in gaming history and genuine innovation in multiplayer design. The pattern of talented teams being passed between owners like trading cards, subjected to questionable management decisions, and ultimately shut down when short-term profits don’t materialize has become depressingly common. Private equity’s growing involvement in gaming raises serious questions about the industry’s sustainability when studios are treated as financial assets rather than creative enterprises. For the dedicated developers at Splash Damage who poured years into cancelled projects and worked under multiple ownership changes, the consultation process represents not just job loss but the end of a studio that once defined what competitive multiplayer could be. If the UK gaming sector continues hemorrhaging talent and institutional knowledge at this pace, the damage will take decades to repair, no matter how many advisory councils governments create.