Following Gamasutra's report this morning of
significant layoffs at Midway's Austin studio, the company has confirmed the cancellation of an "as-yet-unannounced" project at the facility.
With the cancellation comes Midway's confirmation of a "reduction in force of a portion of the affected development team." Between 90 and 130 studio employees, the company says, are impacted by the decision.
A Midway SEC filing shows the layoff decision, which reduces 10 percent of the company's overall workforce, is part of a plan approved today by its Board to reduce costs. Midway's second fiscal quarter showed a $34.8 million net loss and a 26 percent year over year revenue drop from $31.8 million to $23.4 million.
According to the same filing, Midway will write down $10 million in development costs on the canceled project, and that it will be paying out $1.2 million in severance related to these layoffs.
The studio will remain open, playing host to the company's Central Outsourcing Group, while two teams there will continue work on "unnamed prototype projects" that Midway notes are both new IP.
Interim CEO and president Matt Booty said, "While this was a very difficult decision, we feel it was the right thing to do for the future of Midway. We view every game as an investment that must meet certain standards for quality, scheduling, and profitability."
