IO Interactive lays off staff after external partner exits Project Fantasy
IO Interactive cut staff after its external partner exited Project Fantasy, even as the studio said the online fantasy RPG remains in development.
IO Interactive laid off staff after ending its relationship with an external partner on Project Fantasy, the studio’s online fantasy RPG. It did not say how many employees were affected, but said it was making “staffing decisions” while remaining “100% committed” to the game.
The partner was not named in the announcement. Project Fantasy has long been linked to Microsoft. Trial materials from the FTC v. Microsoft case in 2023 identified the game, then called Project Dragon, as an Xbox and PC exclusive that would be published by Xbox Game Studios.
IO tied the cuts to Project Fantasy rather than to 007 First Light, the Bond game it has been promoting after a positive reception. In the same statement, the studio said it was “humbled and honored by the response” to its “young, unproven Bond,” then said the end of the fantasy partnership was a “challenging transition” and that “This wonderful universe will see the light of day.”
In a June 10 memo, Xbox chief Asha Sharma said the business would end the fiscal year at about a 3% accountability margin and that years of more than $20 billion in spending against nearly half a billion dollars in lost annual revenue “cannot continue.” Microsoft’s fiscal year closes on June 30.
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