Schell Games Cuts 49 Jobs, About 40 Percent of Staff, in Second Layoff Round This Year

Schell Games, the Pittsburgh studio known for the I Expect You To Die series, confirmed over the weekend that 49 employees will leave the company, a cut of about 40 percent of its workforce. It is the second round of layoffs this year for a studio that had gone more than two decades without any. The company said the decision was the only way to secure its long-term survival amid strained conditions across the video game industry.

Employees first posted about the cuts on social media last week. The studio then issued a statement describing a significant number of people affected, without giving a figure. The full scale became known through a separate industry report.

From 24 years without cuts to two rounds in months

In August, Schell Games let go about 10 percent of its staff in what chief executive Jesse Schell called a rebalancing. It was the first layoff in the studio's 24-year history and left the company with roughly 125 employees. That round reached marketing, art, design and visual effects roles. The October round is far larger and touches every part of the business, including specialists in the Unity and Unreal game engines, game design, quality assurance and educational research.

The scale of the change stands out given the studio's stated position. In a 2024 interview, Schell said layoffs were a choice and described not putting jobs at risk as a core principle. He argued that established teams build shared knowledge over the years that is hard to replace. The company's careers page still stated that it had never laid anyone off, even after the August round.

VR work shrinks as the studio shifts focus

Behind the cuts is a change in what the studio makes. Work on VR-only games once accounted for 80 percent of its projects. By August that share had fallen to about 30 percent. Schell said the studio would move from a few large games to more smaller projects run in parallel, with more work in VR-adjacent areas such as interactive projection for location-based entertainment.

Several VR titles remain in the catalog, including I Expect You To Die 3, Silent Slayer: Vault of the Vampire and the licensed Among Us VR, later released on desktop as Among Us 3D. The mixed-reality puzzle game Dragon Grove, commissioned by Meta, is still scheduled for release in spring 2027. The studio said Among Us 3D is not part of this round; its four-year partnership behind the game had already ended, and player support now sits with Innersloth, which plans to keep monthly cosmetic drops running.

The cuts fit a wider pattern in VR game development and the games business generally. Sanzaru Games, Twisted Pixel and Polyarc have all closed this year, with Polyarc shutting down after almost 12 years and 29 employees losing their jobs. Mighty Coconut, Kluge Interactive, Survios, Camouflaj and Combat Waffle also cut staff in 2026, while Vertigo Games Amsterdam and two internal nDreams studios closed.

What to watch next

The broader numbers point to a hard year for games employment. The ASGC Games Industry Layoffs Tracker, run by analyst Amir Satvat, counts 10,977 jobs lost in 2026, already above the 9,197 recorded for all of 2025. Roughly 35 studios have closed and 161 have been hit by layoffs. The tracker projects about 13,077 losses by December, which would still fall short of the 15,631 recorded in 2024.

October brought some of the year's largest reductions. Electronic Arts announced it is closing BioWare and ending early development on its next Mass Effect title, part of roughly 400 job cuts, about 3 percent of its staff, with around 50 at BioWare. Sucker Punch laid off 24 employees and Supermassive Games let go of more than 70. Microsoft's Xbox division is still working through 3,200 cuts announced in July. For workers, the picture is a market where even studios with long records of stability are shrinking teams, and where skills tied to specific engines can shift in value as a company changes what it makes.