The brutal wave of layoffs in the video game industry continues, with Starbreeze Studios being the latest to announce a major restructuring. In a move that has disappointed many, the Payday developer has officially canceled its upcoming Dungeons & Dragons co-op game, codenamed “Project Baxter,” and is laying off approximately 44 employees. The reason? A strategic pivot to double down on its flagship franchise and salvage the underperforming Payday 3.
A Difficult but Necessary Decision
Project Baxter, first announced in 2023 for a planned 2026 release, was set to be Starbreeze’s next AAA co-op multiplayer title, built as a live service game within the iconic D&D universe. However, after a strategic review, the company has decided to pull the plug. In a statement, Starbreeze CEO Adolf Kristjansson called it a “difficult but necessary decision,” explaining that the company’s resources are best used to accelerate the growth of the Payday franchise.
“Our strategy is clear: Payday is one of the most iconic IPs in gaming, with unmatched reach and potential,” Kristjansson stated. “By focusing our investment and talent here, we can accelerate delivery, engage players with more content, and reinforce Starbreeze’s position as the clear leader in the heisting genre.” The move involves writing off an estimated $27.3 million in capitalized development costs for the canceled D&D game.
The Cost of a Failed Heist
This dramatic shift in strategy is a direct consequence of the disastrous launch of Payday 3. Released in 2023, the game was plagued by technical issues, a lack of content, and design choices that alienated longtime fans. It failed to meet sales expectations, putting Starbreeze in a precarious financial position. By canceling Project Baxter, the company is making a high-stakes gamble: sacrificing a promising new IP to funnel all available resources into fixing and expanding Payday 3.
The goal, according to the company, is to return to a positive cash flow in 2026. This includes expanding the Payday 3 development team to around 50 people by the end of 2025, hoping to turn the struggling game into the modern “live engagement” hit it was meant to be.
Another Casualty in an Industry-Wide Downturn
The layoffs at Starbreeze are the latest in a relentless series of job losses that have defined the gaming industry over the past year. It’s another stark example of a studio prioritizing shareholder value and focusing on its single most valuable IP at the expense of creative diversification and, most importantly, its employees. This news comes just days after similar announcements from Funcom and Avalanche Studios, painting a grim picture of an industry that seems to be eating itself whole.
Frequently Asked Questions
What was Project Baxter?
Project Baxter was the codename for a cooperative multiplayer Dungeons & Dragons game that was in development at Starbreeze Studios. It was planned as a live service title set for a 2026 release.
Why was it canceled?
Starbreeze canceled the project to reallocate its resources and focus entirely on its flagship franchise, Payday, following the disappointing launch and performance of Payday 3.
How many people were laid off?
Approximately 44 full-time employees and contractors will be laid off as a result of the project’s cancellation.
Is Payday 3 getting more support now?
Yes. Starbreeze has stated that it is “doubling down” on the heisting genre and will be expanding the Payday 3 development team to accelerate content delivery and improve the game.
What does this mean for Starbreeze’s future?
The company is betting its entire future on its ability to turn Payday 3 around and re-establish the franchise as a leader in the co-op shooter genre. The success or failure of this pivot will likely determine the fate of the studio.
Conclusion
Starbreeze’s decision to sacrifice a promising D&D game to save a struggling one is a harsh reflection of the realities of the modern games industry. It’s a painful choice that leaves 44 talented developers out of a job and cancels a project many were excited about. The future of Starbreeze now rests entirely on one question: can they pull off the ultimate heist and save Payday 3?